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AN  ACT 

TO  PROVIDE  REVENUE  TO  DEFRAY  WAR  EXPENSES, 
AND  FOR  OTHER  PURPOSES. 


CONTENTS  OF  THE  ACT  BY  TITLES. 

Page 


Title  I.  War  Income  Tax .  7 

Title  II.  War  Excess  Profits  Tax .  10 

Title  III.  War  Tax  on  Beverages .  18 

Title  IV.  War  Tax  on  Cigars,  Tobacco,  and  Manufactures  Thereof  ....  24 

Title  V.  War  Tax  on  Facilities  Furnished  by  Public  Utilities  and  In¬ 
surance .  26 

Title  VI.  War  Excise  Taxes .  29 

Title  VII.  War  Tax  on  Admissions  and  Dues .  32 

Title  VIII.  War  Stamp  Taxes .  34 

Title  IX.  War  Estate  Tax .  40 

Title  X.  Administrative  Provisions .  41 

Title  XI.  Postal  Rates .  44 

Title  XII.  Income  Tax  Amendments .  46 

Title  XIII.  General  Provisions .  58 


i 


BRIEF  SUMMARY  OF  TITLE  CONTENTS. 
TITLE  I.— WAR  INCOME  TAX. 


Section  1.  War  “Normal  Tax”  on  Citizen  and  Resident  Individuals .  7 

Section  2.  War  “Additional  Tax”  on  Individuals .  7 

Section  3.  Computation,  Assessment  and  Collection  of  War  Income  Taxes 
on  Individuals,  Including  a  Certain  Deduction  at  the 

Source  Provision .  8 

Section  4.  War  Income  Tax  on  Corporations .  9 

Section  5.  War  Income  Tax  Not  Applicable  to  Porto  Rico  and  the  Phil¬ 
ippine  Islands .  9 

TITLE  II.— WAR  EXCESS  PROFITS  TAX. 

Section  200.  Terms  Defined .  10 

Section  201.  Tax  Liability  and  Tax  Rates .  11 

Section  202.  Net  Incomes  of  Less  than  $3,000  are  Exempt  in  Case  of  For¬ 
eign  Corporations  or  Partnerships  or  Non-resident  Alien 

Individuals .  12 

Section  203.  How  Excess  War  Profits  are  Determined — In  General .  12 

Section  204.  How  Excess  Profits  are  Determined  if  Taxpayer  was  Not  in 

Business  in  Prewar  Period .  12 

Section  205.  How  Excess  Profits  are  Determined  if  No  Prewar  Income  or 
if  Percentage  of  Net  Income  on  Invested  Capital  Was 

Low,  by  Comparison .  13 

Section  206.  How  Net  Income  for  the  Prewar  Period  and  for  the  Tax¬ 
able  Year  is  to  be  Ascertained .  14 

Section  207.  “Invested  Capital”  Defined .  14 

Section  208.  Reorganizations,  Consolidations,  or  Changes  of  Ownerships 

After  March  3,  1917. .  16 

Section  209.  Trades  or  Businesses  Having  no  or  Merely  Nominal  Capital.  .  16 

Section  210.  When  Secretary  of  Treasury  is  Unable  to  Determine  Satis¬ 
factorily,  Invested  Capital .  16 

Section  211.  Returns  by  Partnerships . .  17 

3 


Section  212.  r  General  Administrative,  etc.,  Provisions  of  Law  are  Applicable 

to  this  Title .  17 

Section  213.  Commissioner  of  Internal  Revenue  to  make  Necessary  Regu¬ 
lations .  17 

Section  214.  Limitation  of  Munition  Manufacturer’s  Tax  Act  of  Septem¬ 
ber  8,  1916,  rate  thereof  reduced,  and  Repeal  of  Excess 
Profits  Tax  Act  of  March  3,  1917 .  17 

TITLE  III.— WAR  TAX  ON  BEVERAGES. 

Section  300-306.  Distilled  Spirits .  18 

Section  307-308.  Beer  and  other  Fermented  Liquors .  22 

Section  309-310.  Still  Wines,  Cordials,  Champagnes,  Sparkling  Wines,  etc.  23 

Section  311-312.  Grape  Brandy  or  Wine  Spirits .  23 

Section  313.  Sirups  and  Extracts  Used  in  Production  of  Soft  Drinks, 

Soft  Drinks  and  Natural  Mineral  Water .  23 

Section  314.  Returns  by  Manufacturer,  Bottler,  Importer,  etc.,  of 

Sirups,  Soft  Drinks  and  Natural  Mineral  Waters....  24 
Section  315.  Carbonic  Acid  Gas  in  Drums .  24 


TITLE  IV.  WAR  TAX  ON  CIGARS,  TOBACCO  AND  MANUFACTURES 

THEREOF. 


Section  400.  Cigars  and  Cigarettes .  24 

Section  401.  Tobacco  and  Snuff .  25 

Section  402.  Effective  Date  of  Above .  25 

Section  403.  Cigars,  Cigarettes,  Tobacco  and  Snuff  in  Stock  Bearing  Tax- 
paid  Stamps,  Removed  from  Factory,  etc.,  Before  General 

Effective  Date .  26 

Section  404.  Cigarette  Papers .  26 


TITLE  V.  WAR  TAX  ON  FACILITIES  FURNISHED  BY  PUBLIC  UTILITIES 

AND  INSURANCE. 


Section  500. 


Section  501. 

Section  502. 
Section  503. 

Section  504. 
Section  505. 


(a)  Tax  on  Freight  Shipments . 

(b)  Tax  on  Express  Shipments . 

(c)  Tax  on  Transportation  of  Persons  and  on  Seats,  Berths, 

and  Staterooms . 

(d)  Tax  on  Transportation  of  Oil  by  Pipe  Line . 

(e)  Tax  on  Telephone  and  Telegraph  Messages . 

Tax  Paid  Generally  by  the  Payer  of  the  Service  Rendered  and 

Exemptions . 

The  United  States  and  the  States  are  Exempt . 

Collection  of  Above  Taxes  and  Payment  Thereof  to  the 

Government . 

Tax  on  the  Issuance  of  Insurance  Policies . 

Collection  of  the  Insurance  Policy  Tax . 


26 

26 


27 

27 

27 


28 

28 

29 


TITLE  VI.— WAR  EXCISE  TAXES. 


Section  600.  fa)  Automobiles  and  Motor  Cycles .  29 

(b)  Piano  Players,  Talking  Machines,  Records,  etc .  30 

(c-d) Moving  Picture  Films . * .  30 

(e)  Jewelry .  30 

(f)  Sporting  Goods,  Games,  etc .  30 

(g)  Perfumes,  Cosmetics  and  other  Toilet  Articles .  30 

(h)  Proprietary  Medicines .  30 

(i)  Chewing  Gum .  31 

(j)  Cameras .  31 

Section  601.  Returns  and  Payment  of  Tax .  31 

Section  602.  Tax  on  .Articles  in  Hands  of  Certain  Retailers,  etc .  31 

Section  603.  Boats  not  used  exclusively  for  Trade  or  for  National  Defense  31 

4 


TITLE  VII.— WAR  TAX  ON  ADMISSIONS  AND  DUES. 

Page 

Section  700.  Tax  Liability  and  Rates  (Admissions) .  32 

Section  701.  Tax  Liability  and  Rates  (Dues) .  33 

Section  702.  Returns  and  Payment  of  Taxes .  33 

TITLE  VIII.— WAR  STAMP  TAXES. 

Section  800.  In  Effect  December  1,  1917 . . .  34 

Section  801.  United  States,  State,  Municipal  and  Foreign  Government 

Bonds  and  other  Instruments  Exempt .  34 

Section  802.  Penalty  for  Failure  to  Pay  Tax  and  for  Failure  to  Cancel 

Stamps .  34 

Section  803.  Penalty  for  Fraud  in  Connection  with  Stamps .  35 

Section  804.  Cancellation  of  Stamps .  35 

Section  805.  Preparation,  Distribution  and  Affixing  of  Stamps .  35 

Section  806.  Stamps  to  be  on  Sale  at  Post  Offices .  36 

Section  807.  Stamps  to  be  on  Sale  at  United  States  Depositaries .  36 

Schedule  A. — Stamp  Taxes. 

1.  Bonds  of  Indebtedness .  36 

2.  Indemnity  and  Surety  Bonds .  37 

3.  Original  Issue  of  Stock .  37 

4.  Sales  or  Transfers  of  Stock .  37 

5.  Sales  of  Produce  on  Exchanges .  38 

6.  Promissory  Notes  and  Post-Dated  Checks .  39 

7.  Conveyances .  39 

8.  Custom  House  Entries .  39 

9.  Custom  Bonded  Warehouse  Withdrawal  Entries .  39 

10.  Passage  Tickets .  39 

11.  Proxies .  39 

12.  Powers  of  Attorney . 39 

13.  Playing  Cards .  40 

14.  Parcel  Post  Packages .  40 

TITLE  IX— WAR  ESTATE  TAX. 

Section  900.  War  Estate  Tax  Rates .  40 

Section  901.  Exemption  of  Estates  of  Soldiers  and  Sailors  in  Present  War.  41 

TITLE  X.— ADMINISTRATIVE  PROVISIONS. 

Section  1000.  Articles  Purchased  from  or  Sold  to  Virgin  Islands .  41 

Section  1001.  General  Administrative  Provisions  of  Law  Extended  to  this 

Act .  41 

Section  1002.  Return  and  Payment  of  Tax  on  Articles  or  Commodities 

Already  Taxed  by  Existing  Law .  41 

Section  1003.  Collection  of  Tax  when  Method  of  Collection  is  not  Speci¬ 
fically  Provided .  42 

Section  1004.  Penalty  for  Failure  to  Make  Return,  for  False  Return,  for 
Evasion  of  Tax  or  for  Failure  to  Pay  over  Tax,  when 

Penalty  is  not  otherwise  Specifically  Provided .  42 

Section  1005.  Commissioner  of  Internal  Revenue  to  make  Rules  and  Regu¬ 
lations .  42 

Section  1006.  Use  of  Old  Unissued  and  Issued  License  Stamps .  42 

Section  1007.  Vendee  Rather  than  Vendor  pays  Tax  under  Certain  Contract 

Conditions .  42 

Section  1008.  Taxes  Involving  Fraction  of  Cent .  43 

Section  1009.  Advance  Payment  of  Income  and  Excess  Profits  Taxes .  43 

Seccion  1010.  Treasury  Certificates  of  Indebtedness  and  Uncertified  Checks 

Accepted  in  Payment  of  Income  and  Excess  Profits  Taxes.  43 

TITLE  XL— POSTAL  RATES. 

Section  1100.  First  Class  Postal  Rates.  Letters  Written  by  Soldiers .  44 

Sections  1101-1106.  Second  Class  Postal  Rates .  44 

5 


Page 

Section  1107.  Payment  into  Treasury  by  Postmaster-General .  46 

Sections  1108-1109.  Postmasters  in  Military  Service .  46 

Section  1110.  Ethyl  Alcohol  for  Scientific,  etc.,  Purposes,  and  Wines  for 

Sacramental  Uses .  46 

TITLE  XII.— INCOME  TAX  AMENDMENTS. 

Section  1200.  Dividends  Received  by  Individuals  (See  “Sec.  31” — page  57)  46 

Exempt  Income — Interest  on  Government  Bonds....  47 
Section  1201.  Deductions  Allowed  to  Citizen  or  Resident  Individuals 

(Interest  and  Taxes) .  47 

Gifts  by  Citizen  and  Resident  Individuals  to  Charitable, 

etc.,  Organizations  Deductible  to  Certain  Extent .  48 

Section  1202.  Deductions  Allowed  to  Non-Resident  Alien  Individuals 

(Interest  and  Taxes) .  48 

Non-resident  Alien  to  receive  benefit  of  deductions  and 

credits  only  by  filing  return .  48 

Section  1203.  Specific  Exemption  Restricted  to  Citizen  or  Resident  Indi¬ 
viduals  and  their  estates;  Allowance  for  Dependent 

Children .  49 

Section  1204.  Partnerships  May  Fix  Own  Calendar  Year  and  if  Tax  Rates 
for  Calendar  Years  Have  Changed,  Members  Apportion 
Distributive  Amount  and  Pay  Tax  on  Portions  at 

Respective  Rates .  50 

Provisions  for  List  Returns  by  the  Source  Repealed .  50 

Section  1205.  Withholding  at  the  Source  Provisions  Amended  to  Apply 
to  Non-resident  Aliens  Only,  except  as  to  interest 

on  tax-free  covenant,  etc.,  obligations .  50 

License  still  Required  for  Collection  of  Foreign  Items .  51 

Section  1206.  Dividends  Received  by  Corporations  (See  “Sec.  31” — 

page  57.) . ; .  52 

Tax  on  Undistributed  Profits  of  Corporations .  52 

Section  1207.  Deductions  Allowed  to  Corporations  (Interest  and  Taxes)...  53 
Section  1208.  Provisions  relative  to  Deduction  of  Tax  on  Interest  on 
Domestic  Corporate  Obligations  Payable  to  Non¬ 
resident  Alien  Firms,  Corporations,  etc.,  Applicable  to 

“Tax”  Rather  Than  to  “Income” .  55 

Section  1209.  Penalties  for  Failure  to  Pay  Tax,  to  Return  Information  or 

for  False  Information  at  the  Source .  55 

Section  1210.  Special  Returns  by  Corporations  to  Show  Tax  Years  in  which 

Dividends  were  Earned  and  Applicable  Amounts .  55 

Section  1211.  (Sec.  27)  Brokers  to  Supply  Information  regarding  Cus¬ 
tomers;  Names,  Profits,  Losses,  etc .  56 

(Sec.  28)  Information  at  the  Source .  56 

(Sec.  29)  Excess  Profits  Tax  a  credit  for  income  tax .  57 

(Sec.  30)  Foreign  Government  Investments  in  the  United 

States  in  Domestic  Securities .  57 

(Sec.  31)  Definition  and  Taxable  Status  of  “Dividends”.  .  57 

(Sec.  32)  Premiums  on  Insurance  of  Officers,  etc.,  for 

Benefit  of  Company  or  Partnership  Not  Deductible...  58 
Section  1212.  Amounts  Withheld  at  Source  in  1917  to  be  Released  and  Paid 
Over  to  Citizen  and  Resident  Individuals,  Except  the 
Tax-free  Covenant  Cases .  58 


Section  1009.  Advance  Payment  of  Taxes .  43 

Section  1010.  United  States  Treasury  Certificates  of  Indebtedness  and 

Uncertified  Checks  Received  in  Payment  of  Taxes .  43 

TITLE  XIII.— GENERAL  PROVISIONS. 

Section  1300.  Invalidating  Clause .  58 

Section  1301.  Title  I  of  Revenue  Act  of  March  3,  1917,  Repealed .  58 

Section  1302.  General  Effective  Date  of  Act .  58 

6 


WAR  REVENUE  ACT  OF  1917 


AN  ACT 

To  provide  revenue  to  defray  war  expenses,  and  for  other  purposes. 


Be  it  enacted  by  the  Senate  and  House  of  Representatives  of  the 
United  States  of  America  in  Congress  assembled, 


TITLE  I.  War  Income  Tax. 


Section  1.  That  in  addition  to  the  normal  tax  imposed  by 
subdivision  {a)  of  section  one  of  the  Act  entitled  “An  Act  to 
increase  the  revenue,  and  for  other  purposes,”  approved  September 
eighth,  nineteen  hundred  and  sixteen,  there  shall  be  levied,  assessed, 
collected,  and  paid  a  like  normal  tax  of  two  per  centum  upon 
the  income  of  every  individual,  a  citizen  or  resident  of  the  United 
States,  received  in  the  calendar  year  nineteen  hundred  and  seven¬ 
teen  and  every  calendar  year  thereafter. 

Sec.  2.  That  in  addition  to  the  additional  tax  imposed  by 
subdivision  ( b )  of  section  one  of  such  Act  of  September  eighth, 
nineteen  hundred  and  sixteen,  there  shall  be  levied,  assessed, 
collected,  and  paid  a  like  additional  tax  upon  the  income  of  every 
individual  received  in  the  calendar  year  nineteen  hundred  and 
seventeen  and  every  calendar  year  thereafter,  as  follows: 

One  per  centum  per  annum  upon  the  amount  by  which  the  total 
net  income  exceeds  $5,000  and  does  not  exceed  $7,500; 

Two  per  centum  per  annum  upon  the  amount  by  which  the 
total  net  income  exceeds  $7,500  and  does  not  exceed  $10,000; 

Three  per  centum  per  annum  upon  the  amount  by  which  the 
total  net  income  exceeds  $10,000  and  does  not  exceed  $12,500; 

Four  per  centum  per  annum  upon  the  amount  by  which  the 
total  net  income  exceeds  $12,500  and  does  not  exceed  $15,000; 


7 


Five  per  centum  per  annum  upon  the  amount  by  which  the  total 
net  income  exceeds  $15,000  and  does  not  exceed  $20,000; 

Seven  per  centum  per  annum  upon  the  amount  by  which  the  total 
net  income  exceeds  $20,000  and  does  not  exceed  $40,000; 

Ten  per  centum  per  annum  upon  the  amount  by  which  the  total 
net  income  exceeds  $40,000  and  does  not  exceed  $60,000; 

Fourteen  per  centum  per  annum  upon  the  amount  by  which  the 
total  net  income  exceeds  $60,000  and  does  not  exceed  $80,000; 

Eighteen  per  centum  per  annum  upon  the  amount  by  which  the 
total  net  income  exceeds  $80,000  and  does  not  exceed  $100,000; 

Twenty-two  per  centum  per  annum  upon  the  amount  by  which 
the  total  net  income  exceeds  $100,000  and  does  not  exceed  $150,000; 

Twenty-five  per  centum  per  annum  upon  the  amount  by  which 
the  total  net  income  exceeds  $150,000  and  does  not  exceed  $200,000; 

Thirty  per  centum  per  annum  upon  the  amount  by  which  the 
total  net  income  exceeds  $200,000  and  does  not  exceed  $250,000; 

Thirty-four  per  centum  per  annum  upon  the  amount  by  which 
the  total  net  income  exceeds  $250,000  and  does  not  exceed  $300,000; 

Thirty-seven  per  centum  per  annum  upon  the  amount  by  which 
the  total  net  income  exceeds  $300,000  and  does  not  exceed  $500,000; 

Forty  per  centum  per  annum  upon  the  amount  by  which  the 
total  net  income  exceeds  $500,000  and  does  not  exceed  $750,000; 

Forty-five  per  centum  per  annum  upon  the  amount  by  which  the 
total  net  income  exceeds  $750,000  and  does  not  exceed  $1,000,000; 

Fifty  per  centum  per  annum  upon  the  amount  by  which  the  total 
net  income  exceeds  $1,000,000. 

Sec.  3.  That  the  taxes  imposed  by  sections  one  and  two  of 
this  Act  shall  be  computed,  levied,  assessed,  collected,  and  paid 
upon  the  same  basis  and  in  the  same  manner  as  the  similar  taxes 
imposed  by  section  one  of  such  Act  of  September  eighth,  nine¬ 
teen  hundred  and  sixteen,  except  that  in  the  case  of  the  tax  imposed 
by  section  one  of  this  Act  ( a )  the  exemptions  of  $3,000  and  $4,000 
provided  in  section  seven  of  such  Act  of  September  eighth,  nineteen 
hundred  and  sixteen,  as  amended  by  this  Act,  shall  be,  respectively, 
$1,000  and  $2,000,  and  ( b )  the  returns  required  under  subdivisions 


8 


(b)  and  (c)  of  section  eight  of  such  Act,  as  amended  by  this  Act, 
shall  be  required  in  the  case  of  net  incomes  of  $1,000  or  over,  in  the 
case  of  unmarried  persons,  and  $2,000  or  over  in  the  case  of  married 
persons,  instead  of  $3,000  or  over,  as  therein  provided,  and  ( c )  the 
provisions  of  subdivision  ( c )  of  section  nine  of  such  Act,  as  amended 
by  this  Act,  requiring  the  normal  tax  of  individuals  on  income  de¬ 
rived  from  interest  to  be  deducted  and  withheld  at  the  source  of  the 
income  shall  not  apply  to  the  new  two  per  centum  normal  tax  pre¬ 
scribed  in  section  one  of  this  Act  until  on  and  after  January  first, 
nineteen  hundred  and  eighteen,  and  thereafter  only  one  two  per 
centum  normal  tax  shall  be  deducted  and  withheld  at  the  source  under 
the  provisions  of  such  subdivision  (c),  and  any  further  normal  tax 
for  which  the  recipient  of  such  income  is  liable  under  this  Act  or  such 
Act  of  September  eighth,  nineteen  hundred  and  sixteen,  as  amended 
by  this  Act,  shall  be  paid  by  such  recipient. 

Sec.  4.  That  in  addition  to  the  tax  imposed  by  subdivision  ( a ) 
of  section  ten  of  such  Act  of  September  eighth,  nineteen  hundred 
and  sixteen,  as  amended  by  this  Act,  there  shall  be  levied,  assessed, 
collected,  and  paid  a  like  tax  of  four  per  centum  upon  the  income 
received  in  the  calendar  year  nineteen  hundred  and  seventeen  and 
every  calendar  year  thereafter,  by  every  corporation,  joint-stock 
company  or  association,  or  insurance  company,  subject  to  the  tax 
imposed  by  that  subdivision  of  that  section,  except  that  if  it  has  fixed 
its  own  fiscal  year,  the  tax  imposed  by  this  section  for  the  fiscal  year 
ending  during  the  calendar  year  nineteen  hundred  and  seventeen 
shall  be  levied,  assessed,  collected,  and  paid  only  on  that  proportion 
of  its  income  for  such  fiscal  year  which  the  period  between  January 
first,  nineteen  hundred  and  seventeen,  and  the  end  of  such  fiscal  year 
bears  to  the  whole  of  such  fiscal  year. 

The  tax  imposed  by  this  section  shall  be  computed,  levied, 
assessed,  collected,  and  paid  upon  the  same  incomes  and  in  the  same 
manner  as  the  tax  imposed  by  subdivision  ( a )  of  section  ten  of  such 
Act  of  September  eighth,  nineteen  hundred  and  sixteen,  as  amended 
by  this  Act,  except  that  for  the  purpose  of  the  tax  imposed  by  this 
section  the  income  embraced  in  a  return  of  a  corporation,  joint-stock 
company  or  association,  or  insurance  company,  shall  be  credited 
with  the  amount  received  as  dividends  upon  the  stock  or  from  the 
net  earnings  of  any  other  corporation,  joint-stock  company  or  asso¬ 
ciation,  or  insurance  company,  which  is  taxable  upon  its  net  in¬ 
come  as  provided  in  this  title. 

Sec.  5.  That  the  provisions  of  this  title  shall  not  extend  to 
Porto  Rico  or  the  Philippine  Islands,  and  the  Porto  Rican  or  Philip¬ 
pine  Legislature  shall  have  power  by  due  enactment  to  amend,  alter, 
modify,  or  repeal  the  income  tax  laws  in  force  in  Porto  Rico  or  the 
Philippine  Islands,  respectively. 


9 


TITLE  II. — War  Excess  Profits  Tax. 


Sec.  200.  That  when  used  in  this  title — 

The  term  “corporation”  includes  joint-stock  companies  or 
associations,  and  insurance  companies; 

The  term  “domestic”  means  created  under  the  law  of  the  United 
States,  or  of  any  State,  Territory,  or  District  thereof,  and  the  term 
“foreign”  means  created  under  the  law  of  any  other  possession  of 
the  United  States  or  of  any  foreign  country  or  government; 

The  term  “United  States”  means  only  the  States,  the  Territories 
of  Alaska  and  Hawaii,  and  the  District  of  Columbia; 

The  term  “taxable  year”  means  the  twelve  months  ending 
December  thirty-first,  excepting  in  the  case  of  a  corporation  or 
partnership  which  has  fixed  its  own  fiscal  year,  in  which  case  it 
means  such  fiscal  year.  The  first  taxable  year  shall  be  the  year 
ending  December  thirty-first,  nineteen  hundred  and  seventeen, 
except  that  in  the  case  of  a  corporation  or  partnership  which  has 
fixed  its  own  fiscal  year,  it  shall  be  the  fiscal  year  ending  during  the 
calendar  year  nineteen  hundred  and  seventeen.  If  a  corporation  or 
partnership,  prior  to  March  first,  nineteen  hundred  and  eighteen, 
makes  a  return  covering  its  own  fiscal  year,  and  includes  therein  the 
income  received  during  that  part  of  the  fiscal  year  falling  within  the 
calendar  year  nineteen  hundred  and  sixteen,  the  tax  for  such  taxable 
year  shall  be  that  proportion  of  the  tax  computed  upon  the  net 
income  during  such  full  fiscal  year  which  the  time  from  January 
first,  nineteen  hundred  and  seventeen,  to  the  end  of  such  fiscal 
year  bears  to  the  full  fiscal  year;  and 

The  term  “prewar  period”  means  the  calendar  years  nineteen 
hundred  and  eleven,  nineteen  hundred  and  twelve,  and  nineteen 
hundred  and  thirteen,  or,  if  a  corporation  or  partnership  was  not  in 
existence  or  an  individual  was  not  engaged  in  a  trade  or  business 
during  the  whole  of  such  period,  then  as  many  of  such  years  during 
the  whole  of  which  the  corporation  or  partnership  was  in  existence 
or  the  individual  was  engaged  in  the  trade  or  business. 

The  terms  “trade”  and  “business”  include  professions  and  occu¬ 
pations. 

The  term  “net  income”  means  in  the  case  of  a  foreign  corporation 
or  partnership  or  a  non-resident  alien  individual,  the  net  income 
received  from  sources  within  the  United  States. 


10 


Sec.  201.  That  in  addition  to  the  taxes  under  existing  law  and 
under  this  Act  there  shall  be  levied,  assessed,  collected,  and  paid 
for  each  taxable  year  upon  the  income  of  every  corporation,  partner¬ 
ship,  or  individual,  a  tax  (hereinafter  in  this  title  referred  to  as  the 
tax)  equal  to  the  following  percentages  of  the  net  income: 

Twenty  per  centum  of  the  amount  of  the  net  income  in  excess  of 
the  deduction  (determined  as  hereinafter  provided)  and  not  in  excess 
of  fifteen  per  centum  of  the  invested  capital  for  the  taxable  year; 

Twenty-five  per  centum  of  the  amount  of  the  net  income  in 
excess  of  fifteen  per  centum  and  not  in  excess  of  twenty  per  centum 
of  such  capital; 

Thirty-five  per  centum  of  the  amount  of  the  net  income  in  excess 
of  twenty  per  centum  and  not  in  excess  of  twenty-five  per  centum 
of  such  capital; 

Forty-five  per  centum  of  the  amount  of  the  net  income  in  excess 
of  twenty-five  per  centum  and  not  in  excess  of  thirty-three  per 
centum  of  such  capital;  and 

Sixty  per  centum  of  the  amount  of  the  net  income  in  excess  of 
thirty-three  per  centum  of  such  capital. 

For  the  purpose  of  this  title  every  corporation  or  partnership 
not  exempt  under  the  provisions  of  this  section  shall  be  deemed  to 
be  engaged  in  business,  and  all  the  trades  and  businesses  in  which 
it  is  engaged  shall  be  treated  as  a  single  trade  or  business,  and  all 
its  income  from  whatever  source  derived  shall  be  deemed  to  be 
received  from  such  trade  or  business. 

This  title  shall  apply  to  all  trades  or  businesses  of  whatever 
description,  whether  continuously  carried  on  or  not,  except — 

(a)  In  the  case  of  officers  and  employees  under  the  United  States, 
or  any  State,  territory,  or  the  District  of  Columbia,  or  any  local 
sub-division  thereof,  the  compensation  or  fees  received  by  them  as 
such  officers  or  employees; 

( b )  Corporations  exempt  from  tax  under  the  provisions  of  section 
eleven  of  Title  I  of  such  act  of  September  eighth,  nineteen  hundred 
and  sixteen,  as  amended  by  this  Act,  and  partnerships  and  indi¬ 
viduals  carrying  on  or  doing  the  same  business,  or  coming  within  the 
same  description;  and 

(c)  Incomes  derived  from  the  business  of  life,  health,  and  acci¬ 
dent  insurance  combined  in  one  policy  issued  on  the  weekly  premium 
payment  plan. 


11 


Sec.  202.  That  the  tax  shall  not  be  imposed  in  the  case  of  the 
trade  or  business  of  a  foreign  corporation  or  partnership  or  a  non¬ 
resident  alien  individual,  the  net  income  of  which  trade  or  business 
during  the  taxable  year  is  less  than  $3,000. 

Sec.  203.  That  for  the  purposes  of  this  title  the  deduction 
shall  be  as  follows,  except  as  otherwise  in  this  title  provided — 

{a)  In  the  case  of  a  domestic  corporation,  the  sum  of  (1)  an 
amount  equal  to  the  same  percentage  of  the  invested  capital  for  the  tax¬ 
able  year  which  the  average  amount  of  the  annual  net  income  of  the 
trade  or  business  during  the  prewar  period  was  of  the  invested  cap¬ 
ital  for  the  prewar  period  (but  not  less  than  seven  or  more  than  nine 
per  centum  of  the  invested  capital  for  the  taxable  year),  and  (2) 
$3,000; 

(b)  In  the  case  of  a  domestic  partnership  or  of  a  citizen  or  resi¬ 
dent  of  the  United  States,  the  sum  of  (1)  an  amount  equal  to  the 
same  percentage  of  the  invested  capital  for  the  taxable  year  which 
the  average  amount  of  the  annual  net  income  of  the  trade  or  business 
during  the  prewar  period  was  of  the  invested  capital  for  the  prewar 
period  (but  not  less  than  seven  or  more  than  nine  per  centum  of  the 
invested  capital  for  the  taxable  year),  and  (2)  $6,000; 

(c)  In  the  case  of  a  foreign  corporation  or  partnership  or  of 
a  nonresident  alien  individual,  an  amount  ascertained  in  the  same 
manner  as  provided  in  subdivisions  (a)  and  (b),  without  any  ex¬ 
emption  of  $3,000  or  $6,000. 

(< d )  If  the  Secretary  of  the  Treasury  is  unable  satisfactorily  to 
determine  the  average  amount  of  the  annual  net  income  of  the  trade 
or  business  during  the  prewar  period,  the  deduction  shall  be  deter¬ 
mined  in  the  same  manner  as  provided  in  section  two  hundred  and 
five. 

Sec.  204.  That  if  a  corporation  or  partnership  was  not  in  exis¬ 
tence,  or  an  individual  was  not  engaged  in  the  trade  or  business,  during 
the  whole  of  any  one  calendar  year  during  the  prewar  period,  the  de¬ 
duction  shall  be  an  amount  equal  to  eight  per  centum  of  the  invested 
capital  for  the  taxable  year,  plus  in  the  case  of  a  domestic  corpora¬ 
tion  $3,000,  and  in  the  case  of  a  domestic  partnership  or  a  citizen  or 
resident  of  the  United  States  $6,000. 

A  trade  or  business  carried  on  by  a  corporation,  partnership,  or 
individual,  although  formally  organized  or  reorganized  on  or  after 
January  second,  nineteen  hundred  and  thirteen,  which  is  substantially 
a  continuation  of  a  trade  or  business  carried  on  prior  to  that  date, 
shall,  for  the  purpose  of  this  title,  be  deemed  to  have  been  in  existence 


12 


prior  to  that  date,  and  the  net  income  and  invested  capital  of  its  pre¬ 
decessor  prior  to  that  date  shall  be  deemed  to  have  been  its  net  in¬ 
come  and  invested  capital. 

Sec.  205.  (a)  That  if  the  Secretary  of  the  Treasury,  upon  com¬ 

plaint  finds  either  (1)  that  during  the  prewar  period  a  domestic 
corporation  or  partnership,  or  a  citizen  or  resident  of  the  United 
States,  had  no  net  income  from  the  trade  or  business,  or  (2)  that 
during  the  pre-war  period  the  percentage,  which  the  net  income  was 
of  the  invested  capital,  was  low  as  compared  with  the  percentage, 
which  the  net  income  during  such  period  of  representative  corpor¬ 
ations,  partnerships,  and  individuals,  engaged  in  a  like  or  similar 
trade  or  business,  was  of  their  invested  capital,  then  the  deduction 
shall  be  the  sum  of  (1)  an  amount  equal  to  the  same  percentage  of 
its  invested  capital  for  the  taxable  year  which  the  average  deduction 
(determined  in  the  same  manner  as  provided  in  section  two  hundred 
and  three,  without  including  the  $3,000  or  $6,000  therein  referred 
to)  for  such  year  of  representative  corporations,  partnerships  or 
individuals,  engaged  in  a  like  or  similar  trade  or  business,  is  of  their 
average  invested  capital  for  such  year,  plus  (2)  in  the  case  of  a  do¬ 
mestic  corporation  $3,000,  and  in  the  case  of  a  domestic  partnership 
or  a  citizen  or  resident  of  the  United  States  $6,000. 

The  percentage  which  the  net  income  was  of  the  invested  capital 
in  each  trade  or  business  shall  be  determined  by  the  Commissioner 
of  Internal  Revenue,  in  accordance  with  the  regulations  prescribed 
by  him,  with  the  approval  of  the  Secretary  of  the  Treasury.  In  the 
case  of  a  corporation  or  partnership  which  has  fixed  its  own  fiscal 
year,  the  percentage  determined  for  the  calendar  year  ending  during 
such  fiscal  year  shall  be  used. 

(b)  The  tax  shall  be  assessed  upon  the  basis  of  the  deduction 
determined  as  provided  in  section  two  hundred  and  three,  but  the 
taxpayer  claiming  the  benefit  of  this  section  may  at  the  time  of 
making  the  return  file  a  claim  for  abatement  of  the  amount  by  which 
the  tax  so  assessed  exceeds  a  tax  computed  upon  the  basis  of  the 
deduction  determined  as  provided  in  this  section.  In  such  event, 
collection  of  the  part  of  the  tax  covered  by  such  claim  for  abate¬ 
ment  shall  not  be  made  until  the  claim  is  decided,  but  if  in  the 
judgment  of  the  Commissioner  of  Internal  Revenue,  the  interests  of 
the  United  States  would  be  jeopardized  thereby  he  may  require 
the  claimant  to  give  a  bond  in  such  amount  and  with  such  sureties 
as  the  Commissioner  may  think  wise  to  safeguard  such  interests, 
conditioned  for  the  payment  of  any  tax  found  to  be  due,  with  the 
interest  thereon,  and  if  such  bond,  satisfactory  to  the  Commissioner, 
is  not  given  within  such  time  as  he  prescribes,  the  full  amount  of 
tax  assessed  shall  be  collected  and  the  amount  overpaid,  if  any, 
shall  upon  final  decision  of  the  application  be  refunded  as  a  tax 
erroneously  or  illegally  collected. 

13 


Sec.  206.  That  for  the  purposes  of  this  title  the  net  income  of  a 
corporation  shall  be  ascertained  and  returned  (a)  for  the  calendar 
years  nineteen  hundred  and  eleven  and  nineteen  hundred  and  twelve 
upon  the  same  basis  and  in  the  same  manner  as  provided  in  section 
thirty-eight  of  the  Act  entitled  “An  Act  to  provide  revenue,  equalize 
duties,  and  encourage  the  industries  of  the  United  States,  and  for 
other  purposes,”  approved  August  fifth,  nineteen  hundred  and  nine, 
except  that  income  taxes  paid  by  it  within  the  year  imposed  by  the 
authority  of  the  United  States  shall  be  included;  ( b )  for  the  calendar 
year  nineteen  hundred  and  thirteen  upon  the  same  basis  and  in  the 
same  manner  as  provided  in  section  II  of  the  Act  entitled  “An  Act 
to  reduce  tariff  duties  and  to  provide  revenue  for  the  Government, 
and  for  other  purposes,”  approved  October  third,  nineteen  hundred 
and  thirteen,  except  that  income  taxes  paid  by  it  within  the  year 
imposed  by  the  authority  of  the  United  States  shall  be  included,  and 
except  that  the  amounts  received  by  it  as  dividends  upon  the  stock 
or  from  the  net  earnings  of  other  corporations,  joint-stock  companies 
or  associations,  or  insurance  companies,  subject  to  the  tax  imposed  by 
section  II  of  such  Act  of  October  third,  nineteen  hundred  and  thir¬ 
teen,  shall  be  deducted;  and  ( c )  for  the  taxable  year  upon  the 
same  basis  and  in  the  same  manner  as  provided  in  Title  I  of  the 
Act  entitled  “An  Act  to  increase  the  revenue,  and  for  other  pur¬ 
poses,”  approved  September  eighth,  nineteen  hundred  and  sixteen, 
as  amended  by  this  Act,  except  that  the  amounts  received  by  it  as 
dividends  upon  the  stock  or  from  the  net  earnings  of  other  corpora¬ 
tions,  joint-stock  companies  or  associations,  or  insurance  companies, 
subject  to  the  tax  imposed  by  Title  I  of  such  Act  of  September  eighth, 
nineteen  hundred  and  sixteen,  shall  be  deducted. 

The  net  income  of  a  partnership  or  individual  shall  be  ascertained 
and  returned  for  the  calendar  years  nineteen  hundred  and  eleven, 
nineteen  hundred  and  twelve,  and  nineteen  hundred  and  thirteen, 
and  for  the  taxable  year,  upon  the  same  basis  and  in  the  same  manner 
as  provided  in  Title  I  of  such  Act  of  September  eighth,  nineteen 
hundred  and  sixteen,  as  amended  by  this  Act,  except  that  the  credit 
allowed  by  subdivision  ( b )  of  section  five  of  such  Act  shall  be 
deducted.  There  shall  be  allowed  (a)  in  the  case  of  a  domestic 
partnership  the  same  deductions  as  allowed  to  individuals  in  sub¬ 
division  (a)  of  section  five  of  such  Act  of  September  eighth,  nineteen 
hundred  and  sixteen,  as  amended  by  this  Act;  and  ( b )  in  the  case 
of  a  foreign  partnership  the  same  deductions  as  allowed  to  individuals 
in  subdivision  (a)  of  section  six  of  such  Act  as  amended  by  this  Act. 

Sec.  207.  That  as  used  in  this  title  the  term  “invested  capital” 
for  any  year  means  the  average  invested  capital  for  the  year,  as 
defined  and  limited  in  this  title,  averaged  monthly. 

As  used  in  this  title  “invested  capital”  does  not  include  stocks, 

14 


bonds  (other  than  obligations  of  the  United  States),  or  other  assets, 
the  income  from  which  is  not  subject  to  the  tax  imposed  by  this 
title,  nor  money  or  other  property  borrowed,  and  means,  subject 
to  the  above  limitations: 

(a)  In  the  case  of  a  corporation  or  partnership:  (1)  actual 
cash  paid  in,  (2)  the  actual  cash  value  of  tangible  property  paid 
in  other  than  cash,  for  stock  or  shares  in  such  corporation  or  partner¬ 
ship,  at  the  time  of  such  payment  (but  in  case  such  tangible  property 
was  paid  in  prior  to  January  first,  nineteen  hundred  and  fourteen, 
the  actual  cash  value  of  such  property  as  of  January  first,  nineteen 
hundred  and  fourteen,  but  in  no  case  to  exceed  the  par  value  of  the 
original  stock  or  shares  specifically  issued  therefor),  and  (3)  paid  in 
or  earned  surplus  and  undivided  profits  used  or  employed  in  the 
business,  exclusive  of  undivided  profits  earned  during  the  taxable 
year;  Provided ,  That  ( a )  the  actual  cash  value  of  patents  and 
copyrights  paid  in  for  stock  or  shares  in  such  corporation  or  part¬ 
nership,  at  the  time  of  such  payment,  shall  be  included  as  invested 
capital,  but  not  to  exceed  the  par  value  of  such  stock  or  shares  at  the 
time  of  such  payment,  and  ( b )  the  good  will,  trade  marks,  trade 
brands,  the  franchise  of  a  corporation  or  partnership,  or  other  in¬ 
tangible  property,  shall  be  included  as  invested  capital  if  the  cor¬ 
poration  or  partnership  made  payment  bona  fide  therefor  specifically 
as  such  in  cash  or  tangible  property,  the  value  of  such  good  will, 
trade  mark,  trade  brand,  franchise,  or  intangible  property,  not  to 
exceed  the  actual  cash  or  actual  cash  value  of  the  tangible  property 
paid  therefor  at  the  time  of  such  payment;  but  good  will,  trade¬ 
marks,  trade  brands,  franchise  of  a  corporation  or  partnership,  or 
other  intangible  property,  bona  fide  purchased,  prior  to  March 
third,  nineteen  hundred  and  seventeen,  for  and  with  interests  or 
shares  in  a  partnership  or  for  and  with  shares  in  the  capital  stock 
of  a  corporation  (issued  prior  to  March  third,  nineteen  hundred  and 
seventeen),  in  an  amount  not  to  exceed,  on  March  third,  nineteen 
hundred  and  seventeen,  twenty  per  centum  of  the  total  interests  or 
shares  in  the  partnership  or  of  the  total  shares  of  the  capital  stock 
of  the  corporation,  shall  be  included  in  invested  capital  at  a  value 
not  to  exceed  the  actual  cash  value  at  the  time  of  such  purchase, 
and  in  case  of  issue  of  stock  therefor  not  to  exceed  the  par  value  of 
such  stock; 

(b)  In  the  case  of  an  individual,  (1)  actual  cash  paid  into  the 
trade  or  business,  and  (2)  the  actual  cash  value  of  tangible  prop¬ 
erty  paid  into  the  trade  or  business,  other  than  cash,  at  the  time 
of  such  payment  (but  in  case  such  tangible  property  was  paid  in 
prior  to  January  first,  nineteen  hundred  and  fourteen,  the  actual 
cash  value  of  such  property  as  of  January  first,  nineteen  hundred 
and  fourteen),  and  (3)  the  actual  cash  value  of  patents,  copyrights, 
good  will,  trade  marks,  trade  brands,  franchises,  or  other  intan- 

15 


gible  property,  paid  into  the  trade  or  business,  at  the  time  of  such 
payment,  if  payment  was  made  therefor  specifically  as  such  in 
cash  or  tangible  property,  not  to  exceed  the  actual  cash  or  actual 
cash  value  of  the  tangible  property  bona  fide  paid  therefor  at  the  time 
of  such  payment. 

In  the  case  of  a  foreign  corporation  or  partnership  or  of  a  non¬ 
resident  alien  individual  the  term  “invested  capital”  means  that 
proportion  of  the  entire  invested  capital,  as  defined  and  limited 
in  this  title,  which  the  net  income  from  sources  within  the  United 
States  bears  to  the  entire  net  income. 

Sec.  208.  That  in  case  of  the  reorganization,  consolidation,  or 
change  of  ownership  of  a  trade  or  business  after  March  third,  nine¬ 
teen  hundred  and  seventeen,  if  an  interest  or  control  in  such  trade 
or  business  of  fifty  per  centum  or  more  remains  in  control  of  the 
same  persons,  corporations,  associations,  partnerships,  or  any  of 
them,  then  in  ascertaining  the  invested  capital  of  the  trade  or  busi¬ 
ness  no  asset  transferred  or  received  from  the  prior  trade  or  business 
shall  be  allowed  a  greater  value  than  would  have  been  allowed  under 
this  title  in  computing  the  invested  capital  of  such  prior  trade  or 
business  if  such  asset  had  not  been  so  transferred  or  received,  unless 
such  asset  was  paid  for  specifically  as  such,  in  cash  or  tangible 
property,  and  then  not  to  exceed  the  actual  cash  or  actual  cash  value 
of  the  tangible  property  paid  therefor  at  the  time  of  such  payment. 

Sec.  209.  That  in  the  case  of  a  trade  or  business  having  no 
invested  capital  or  not  more  than  a  nominal  capital  there  shall  be 
levied,  assessed,  collected,  and  paid,  in  addition  to  the  taxes  under 
existing  law  and  under  this  act,  in  lieu  of  the  tax  imposed  by  section 
two  hundred  and  one,  a  tax  equivalent  to  eight  per  centum  of  the 
net  income  of  such  trade  or  business,  in  excess  of  the  following 
deductions:  in  the  case  of  a  domestic  corporation,  $3,000,  and  in  the 
case  of  a  domestic  partnership,  or  a  citizen  or  resident  of  the  United 
States,  $6,000,  in  the  case  of  all  other  trades  or  business,  no  deduc¬ 
tion. 

Sec.  210.  That  if  the  Secretary  of  the  Treasury  is  unable  in  any 
case  satisfactorily  to  determine  the  invested  capital,  the  amount  of 
the  deduction  shall  be  the  sum  of  (1)  an  amount  equal  to  the  same 
proportion  of  the  net  income  of  the  trade  or  business  received  during 
the  taxable  year  as  the  proportion  which  the  average  deduction 
(determined  in  the  same  manner  as  provided  in  section  two  hundred 
and  three,  without  including  the  $3,000  or  $6,000  therein  referred 
to)  for  the  same  calendar  year  of  representative  corporations,  part¬ 
nerships,  and  individuals,  engaged  in  a  like  or  similar  trade  or  busi¬ 
ness,  bears  to  the  total  net  income  of  the  trade  or  business  received 
by  such  corporations,  partnerships,  and  individuals,  plus  (2)  in  the 


16 


case  of  a  domestic  corporation  $3,000,  and  in  the  case  of  a  domestic 
partnership  or  a  citizen  or  resident  of  the  United  States  $6,000. 

For  the  purpose  of  this  section  the  proportion  between  the 
deduction  and  the  net  income  in  each  trade  or  business  shall  be 
determined  by  the  commissioner  of  internal  revenue  in  accordance 
with  regulations  prescribed  by  him,  with  the  approval  of  the  Secre¬ 
tary  of  the  Treasury.  In  the  case  of  a  corporation  or  partnership 
which  has  fixed  its  own  fiscal  year,  the  proportion  determined  for 
the  calendar  year  ending  during  such  fiscal  year  shall  be  used. 

Sec.  211.  That  every  foreign  partnership  having  a  net  income 
of  $3,000  or  more  for  the  taxable  year,  and  every  domestic  partner¬ 
ship  having  a  net  income  of  $6,000  or  more  for  the  taxable  year,  shall 
render  a  correct  return  of  the  income  of  the  trade  or  business  for  the 
taxable  year,  setting  forth  specifically  the  gross  income  for  such  year, 
and  the  deductions  allowed  in  this  title.  Such  returns  shall  be 
rendered  at  the  same  time  and  in  the  same  manner  as  is  prescribed 
for  income-tax  returns  under  Title  I  of  such  Act  of  September  eighth, 
nineteen  hundred  and  sixteen,  as  amended  by  this  Act. 

Sec.  212.  That  all  administrative,  special,  and  general  pro¬ 
visions  of  law,  including  the  laws  in  relation  to  the  assessment, 
remission,  collection,  and  refund  of  internal-revenue  taxes  not 
heretofore  specifically  repealed,  and  not  inconsistent  with  the  pro¬ 
visions  of  this  title,  are  hereby  extended  and  made  applicable  to  all 
the  provisions  of  this  title  and  to  the  tax  herein  imposed,  and  all 
provisions  of  Title  I  of  such  Act  of  September  eighth,  nineteen  hun¬ 
dred  and  sixteen,  as  amended  by  this  Act,  relating  to  returns  and 
payment  of  the  tax  therein  imposed,  including  penalties,  are  hereby 
made  applicable  to  the  tax  imposed  by  this  title. 

Sec.  213.  That  the  Commissioner  of  Internal  Revenue,  with 
the  approval  of  the  Secretary  of  the  Treasury,  shall  make  all  neces¬ 
sary  regulations  for  carrying  out  the  provisions  of  this  title,  and 
may  require  any  corporation,  partnership,  or  individual,  subject  to 
the  provisions  of  this  title,  to  furnish  him  with  such  facts,  data,  and 
information  as  in  his  judgment  are  necessary  to  collect  the  tax 
imposed  by  this  title. 

Sec.  214.  That  Title  II  (sections  two  hundred  to  two  hundred 
and  seven,  inclusive)  of  the  Act  entitled  “An  Act  to  provide  increased 
revenue  to  defray  the  expenses  of  the  increased  appropriations  for 
the  Army  and  Navy,  and  the  extensions  of  fortifications,  and  for 
other  purposes,”  approved  March  third,  nineteen  hundred  and 
seventeen,  is  hereby  repealed. 

Any  amount  heretofore  or  hereafter  paid  on  account  of  the  tax 


17 


imposed  by  such  Title  II,  shall  be  credited  toward  the  payment  of 
the  tax  imposed  by  this  title,  and  if  the  amount  so  paid  exceeds  the 
amount  of  such  tax  the  excess  shall  be  refunded  as  a  tax  erroneously 
or  illegally  collected. 

Subdivision  (1)  of  section  three  hundred  and  one  of  such  Act  of 
September  eighth,  nineteen  hundred  and  sixteen,  is  hereby  amended 
so  that  the  rate  of  tax  for  the  taxable  year  nineteen  hundred  and 
seventeen  shall  be  ten  per  centum  instead  of  twelve  and  one-half 
per  centum,  as  therein  provided. 

Subdivision  (2)  of  such  section  is  hereby  amended  to  read  as 
follows : 

“(2)  This  section  shall  cease  to  be  of  effect  on  and  after  January 
first,  nineteen  hundred  and  eighteen.” 


TITLE  III.— War  Tax  on  Beverages. 


Sec.  300.  That  on  and  after  the  passage  of  this  Act  there  shall 
be  levied  and  collected  on  all  distilled  spirits  in  bond  at  that  time 
or  that  have  been  or  that  may  be  then  or  thereafter  produced  in  or 
imported  into  the  United  States,  except  such  distilled  spirits  as  are 
subject  to  the  tax  provided  in  section  three  hundred  and  three,  in 
addition  to  the  tax  now  imposed  by  law,  a  tax  of  $1.10  (or,  if  with¬ 
drawn  for  beverage  purposes  or  for  use  in  the  manufacture  or  pro¬ 
duction  of  any  article  used  or  intended  for  use  as  a  beverage,  a  tax 
of  $2.10)  on  each  proof  gallon,  or  wine  gallon  when  below  proof,  and 
a  proportionate  tax  at  a  like  rate  on  all  fractional  parts  of  such  proof 
or  wine  gallon,  to  be  paid  by  the  distiller  or  importer  when  withdrawn 
and  collected  under  the  provisions  of  existing  law. 

That  in  addition  to  the  tax  under  existing  law  there  shall  be 
levied  and  collected  upon  all  perfumes  hereafter  imported  into  the 
United  States  containing  distilled  spirits,  a  tax  of  $1.10  per  wine 
gallon,  and  a  proportionate  tax  at  a  like  rate  on  all  fractional  parts 
of  such  wine  gallon  Such  tax  shall  be  collected  by  the  collector  of 
customs  and  deposited  as  internal-revenue  collections,  under  such 
rules  and  regulations  as  the  Commissioner  of  Internal  Revenue,  with 
the  approval  of  the  Secretary  of  the  Treasury,  may  prescribe. 

Sec.  301.  That  no  distilled  spirits  produced  after  the  passage 
of  this  Act  shall  be  imported  into  the  United  States  from  any  foreign 
country,  or  from  the  West  Indian  Islands  recently  acquired  from 
Denmark  (unless  produced  from  products  the  growth  of  such  islands, 
and  not  then  into  any  State  or  Territory  or  District  of  the  United 


18 


States  in  which  the  manufacture  or  sale  of  intoxicating  liquor  is 
prohibited),  or  from  Porto  Rico,  or  the  Philippine  Islands.  Under 
such  rules,  regulations,  and  bonds  as  the  Secretary  of  the  Treasury 
may  prescribe,  the  provisions  of  this  section  shall  not  apply  to  dis¬ 
tilled  spirits  imported  for  other  than  (1)  beverage  purposes  or  (2) 
use  in  the  manufacture  or  production  of  any  article  used  or  intended 
for  use  as  a  beverage. 

Sec.  302.  That  at  registered  distilleries  producing  alcohol,  or 
other  high-proof  spirits,  packages  may  be  filled  with  such  spirits 
reduced  to  not  less  than  one  hundred  proof  from  the  receiving 
cisterns  and  tax  paid  without  being  entered  into  bonded  warehouse. 
Such  spirits  may  also  be  transferred  from  the  receiving  cisterns  at 
such  distilleries,  by  means  of  pipe  lines,  direct  to  storage  tanks  in  the 
bonded  warehouse  and  may  be  warehoused  in  such  storage  tanks. 
Such  spirits  may  be  also  transferred  in  tanks  or  tank  cars  to  general 
bonded  warehouses  for  storage  therein,  either  in  storage  tanks  in 
such  warehouses  or  in  the  tanks  in  which  they  were  transferred. 
Such  spirits  may  also  be  transferred  after  tax  payment  from  receiving 
cisterns  or  warehouse  storage  tanks  to  tanks  or  tank  cars  and  may 
be  transported  in  such  tanks  or  tank  cars  to  the  premises  of  rectifiers 
of  spirits.  The  Commissioner  of  Internal  Revenue,  with  the  approval 
of  the  Secretary  of  the  Treasury,  is  hereby  empowered  to  prescribe 
all  necessary  regulations  relating  to  the  drawing  off,  transferring, 
gauging,  storing  and  transporting  of  such  spirits;  the  records  to  be 
kept  and  returns  to  be  made;  the  size  and  kind  of  packages  and  tanks 
to  be  used;  the  marking,  branding,  numbering  and  stamping  of  such 
packages  and  tanks;  the  kinds  of  stamps,  if  any,  to  be  used;  and 
the  time  and  manner  of  paying  the  tax;  the  kind  of  bond  and  the 
penal  sum  of  same.  The  tax  prescribed  by  law  must  be  paid  before 
such  spirits  are  removed  from  the  distillery  premises,  or  from  general 
bonded  warehouse  in  the  case  of  spirits  transferred  thereto,  except  as 
otherwise  provided  by  law. 

Under  such  regulations  as  the  Commissioner  of  Internal  Revenue, 
with  the  approval  of  the  Secretary  of  the  Treasury,  may  prescribe, 
distilled  spirits  may  hereafter  be  drawn  from  receiving  cisterns  and 
deposited  in  distillery  warehouses  without  having  affixed  to  the 
packages  containing  the  same  distillery  warehouse  stamps,  and  such 
packages,  when  so  deposited  in  warehouse,  may  be  withdrawn  there¬ 
from  on  the  original  gauge  where  the  same  have  remained  in  such 
warehouse  for  a  period  not  exceeding  thirty  days  from  the  date  of 
deposit. 

Under  such  regulations  as  the  Commissioner  of  Internal  Revenue, 
with  the  approval  of  the  Secretary  of  the  Treasury,  may  prescribe, 
the  manufacturer,  warehousing,  withdrawal,  and  shipment,  under  the 
provisions  of  existing  law,  of  ethyl  alcohol  for  other  than  (I)  bever- 


19 


age  purposes  or  (2)  use  in  the  manufacture  or  production  of  any  ar¬ 
ticle  used  or  intended  for  use  as  a  beverage  and  denatured  alcohol, 
may  be  exempted  from  the  provisions  of  section  thirty-two  hundred 
and  eighty-three,  Revised  Statutes  of  the  United  States. 

Under  such  regulations  as  the  Commissioner  of  Internal  Revenue, 
with  the  approval  of  the  Secretary  of  the  Treasury,  may  prescribe, 
manufacturers  of  ethyl  alcohol  for  other  than  beverage  purposes 
may  be  granted  permission  under  the  provisions  of  section  thirty- 
two  hundred  and  eighty-five,  Revised  Statutes  of  the  United  States, 
to  fill  fermenting  tubs  in  a  sweet-mash  distillery  not  oftener  than 
once  in  forty-eight  hours. 

Sec.  303.  That  upon  all  distilled  spirits  produced  in  or  imported 
into  the  United  States  upon  which  the  tax  now  imposed  by  law  has 
been  paid,  and  which,  on  the  day  this  Act  is  passed,  are  held  by  a 
retailer  in  a  quantity  in  excess  of  fifty  gallons  in  the  aggregate,  or 
by  any  other  person,  corporation,  partnership,  or  association  in  any 
quantity,  and  which  are  intended  for  sale,  there  shall  be  levied, 
assessed,  collected,  and  paid  a  tax  of  $1.10  (or,  if  intended  for  sale 
for  beverage  purposes  or  for  use  in  the  manufacture  or  production 
of  any  article  used  or  intended  for  use  as  a  beverage,  a  tax  of  $2.10) 
on  each  proof  gallon,  and  a  proportionate  tax  at  a  like  rate  on  all 
fractional  parts  of  such  proof  gallon:  Provided ,  That  the  tax  on  such 
distilled  spirits  in  the  custody  of  a  court  of  bankruptcy  in  insol¬ 
vency  proceedings  on  June  first,  nineteen  hundred  and  seventeen, 
shall  be  paid  by  the  person  to  whom  the  court  delivers  such 
distilled  spirits  at  the  time  of  such  delivery,  to  the  extent  that 
the  amount  thus  delivered  exceeds  the  fifty  gallons  herein  before 
provided. 

Sec.  304.  That  in  addition  to  the  tax  now  imposed  or  imposed 
by  this  Act  on  distilled  spirits  there  .shall  be  levied,  assessed,  col¬ 
lected,  and  paid  a  tax  of  15  cents  on  each  proof  gallon  and  a  pro¬ 
portionate  tax  at  a  like  rate  on  all  fractional  parts  of  such  proof 
gallon  on  all  distilled  spirits  or  wines  hereafter  rectified,  purified,  or 
refined  in  such  manner,  and  on  all  mixtures  hereafter  produced  in 
such  manner,  that  the  person  so  rectifying,  purifying,  refining,  or 
mixing  the  same  is  a  rectifier  within  the  meaning  of  section  thirty- 
two  hundred  and  forty-four,  Revised  Statutes,  as  amended,  and  on 
all  such  articles  in  the  possession  of  the  rectifier  on  the  day  this  Act 
is  passed:  Provided ,  That  this  tax  shall  not  apply  to  gin  produced 
by  the  redistillation  of  a  pure  spirit  over  juniper  berries  and  other 
aromatics. 

When  the  process  of  rectification  is  completed  and  the  tax  pre¬ 
scribed  by  this  section  has  been  paid,  it  shall  be  unlawful  for  the 
rectifier  or  other  dealer  to  reduce  in  proof  or  increase  in  volume  such 


20 


spirits  or  wine  by  the  addition  of  water  or  other  substance;  nothing 
herein  contained  shall,  however,  prevent  a  rectifier  from  using  again 
in  the  process  of  rectification  spirits  already  rectified  and  upon  which 
the  tax  has  theretofore  been  paid. 

The  tax  imposed  by  this  section  shall  not  attach  to  cordials  or 
liqueurs  on  which  a  tax  is  imposed  and  paid  under  the  Act  entitled 
“An  Act  to  increase  the  revenue,  and  for  other  purposes/’  approved 
September  eighth,  nineteen  hundred  and  sixteen,  nor  to  the  mixing 
and  blending  of  wines,  where  such  blending  is  for  the  sole  purpose 
of  perfecting  such  wines  according  to  commercial  standards,  nor  to 
blends  made  exclusively  of  two  or  more  pure  straight  whiskies 
aged  in  wood  for  a  period  not  less  than  four  years  and  without  the 
addition  of  coloring  or  flavoring  matter  or  any  other  substance  than 
pure  water  and  if  not  reduced  below  ninety  proof:  Provided ,  That 
such  blended  whiskies  shall  be  exempt  from  tax  under  this  section 
only  when  compounded  under  the  immediate  supervision  of  a 
revenue  officer,  in  such  tanks  and  under  such  conditions  and  super¬ 
vision  as  the  Commissioner  of  Internal  Revenue,  with  the  approval 
of  the  Secretary  of  the  Treasury,  may  prescribe. 

All  distilled  spirits  taxable  under  this  section  shall  be  subject 
to  uniform  regulations  concerning  the  use  thereof  in  the  manu¬ 
facture,  blending,  compounding,  mixing,  marking,  branding,  and 
sale  of  whiskey  and  rectified  spirits,  and  no  discrimination  what¬ 
soever  shall  be  made  by  reason  of  a  difference  in  the  character  of  the 
material  from  which  same  may  have  been  produced. 

The  business  of  a  rectifier  of  spirits  shall  be  carried  on,  and  the 
tax  on  rectified  spirits  shall  be  paid,  under  such  rules,  regulations,  and 
bonds  as  may  be  prescribed  by  the  Commissioner  of  Internal  Revenue, 
with  the  approval  of  the  Secretary  of  the  Treasury. 

Any  person  violating  any  of  the  provisions  of  this  section  shall 
be  deemed  to  be  guilty  of  a  misdemeanor  and,  upon  conviction,  shall 
be  fined  not  more  than  $1,000  or  imprisoned  not  more  than  two  years. 
He  shall,  in  addition,  be  liable  to  double  the  tax  evaded,  together 
with  the  tax,  to  be  collected  by  assessment  or  on  any  bond  given. 

Sec.  305.  That  hereafter  collectors  of  internal  revenue  shall  not 
furnish  wholesale  liquor  dealer’s  stamps  in  lieu  of  and  in  exchange  for 
stamps  for  rectified  spirits  unless  the  package  covered  by  stamp  for 
rectified  spirits  is  to  be  broken  into  smaller  packages. 

The  Commissioner  of  Internal  Revenue,  with  the  approval  of 
the  Secretary  of  the  Treasury,  is  authorized  to  discontinue  the  use 
of  the  following  stamps  whenever  in  his  judgment  the  interests  of  the 
Government  will  be  subserved  thereby: 


21 


Distillery  warehouse,  special  bonded  warehouse,  special  bonded 
rewarehouse,  general  bonded  warehouse,  general  bonded  retransfer, 
transfer  brandy,  export  tobacco,  export  cigars,  export  oleomargarine 
and  export  fermented  liquor  stamps. 

Sec.  306.  That  the  Commissioner  of  Internal  Revenue,  with 
the  approval  of  the  Secretary  of  the  Treasury,  is  hereby  authorized 
to  require  at  distilleries,  breweries,  rectifying  houses,  and  wherever 
else  in  his  judgment  such  action  may  be  deemed  advisable,  the 
installation  of  meters,  tanks,  pipes,  or  any  other  apparatus  for  the 
purpose  of  protecting  the  revenue,  and  such  meters,  tanks,  and  pipes 
and  all  necessary  labor  incident  thereto  shall  be  at  the  expense  of  the 
person,  corporation,  partnership,  or  association  on  whose  premises 
the  installation  is  required.  Any  such  person,  corporation,  partner¬ 
ship,  or  association  refusing  or  neglecting  to  install  such  apparatus 
when  so  required  by  the  commissioner  shall  not  be  permitted  to 
conduct  business  on  such  premises. 

Sec.  307.  That  on  and  after  the  passage  of  this  Act  there  shall 
be  levied  and  collected  on  all  beer,  lager  beer,  ale,  porter,  and  other 
similar  fermented  liquor,  containing  one-half  per  centum  or  more  of 
alcohol,  brewed  or  manufactured  and  sold,  or  stored  in  warehouse,  or 
removed  for  consumption  or  sale,  within  the  United  States,  by 
whatever  name  such  liquors  may  be  called,  in  addition  to  the  tax 
now  imposed  by  law,  a  tax  of  $1.50  for  every  barrel  containing  not 
more  than  thirty-one  gallons,  and  at  a  like  rate  for  any  other  quantity 
or  for  the  fractional  parts  of  a  barrel  authorized  and  defined  by  law. 

Sec.  308.  That  from  and  after  the  passage  of  this  Act  taxable 
fermented  liquors  may  be  conveyed  without  payment  of  tax  from 
the  brewery  premises  where  produced  to  a  contiguous  industrial 
distillery  of  either  class  established  under  the  Act  of  October  third, 
nineteen  hundred  and  thirteen,  to  be  used  as  distilling  material,  and 
the  residue  from  such  distillation,  containing  less  than  one- 
half  of  one  per  centum  of  alcohol  by  volume,  which  is  to  be  used  in 
making  beverages,  may  be  manipulated  by  cooling,  flavoring,  car¬ 
bonating,  settling,  and  filtering  on  the  distillery  premises  or  elsewhere. 

The  removal  of  the  taxable  fermented  liquor  from  the  brewery 
to  the  distillery  and  the  operation  of  the  distillery  and  removal  of 
the  residue  therefrom  shall  be  under  the  supervision  of  such  officer 
or  officers  as  the  Commissioner  of  Internal  Revenue  shall  deem  proper, 
and  the  Commissioner  of  Internal  Revenue,  with  the  approval  of  the 
Secretary  of  the  Treasury,  is  hereby  authorized  to  make  such  regu¬ 
lations  from  time  to  time  as  may  be  necessary  to  give  force  and  effect 
to  this  section  and  to  safeguard  the  revenue. 


22 


Sec.  309.  That  upon  all  still  wines,  including  vermuth,  and  upon 
all  champagne  and  other  sparkling  wines,  liqueurs,  cordials,  artificial 
or  imitation  wines  or  compounds  sold  as  wine,  produced  in  or  im¬ 
ported  into  the  United  States,  and  hereafter  removed  from  the  cus¬ 
tom-house,  place  of  manufacture,  or  from  bonded  premises  for  sale 
or  consumption,  there  shall  be  levied  and  collected,  in  addition  to 
the  tax  now  imposed  by  law  upon  such  articles,  a  tax  equal  to 
such  tax,  to  be  levied,  collected,  and  paid  under  the  provisions  of 
existing  law. 

Sec.  310.  That  upon  all  articles  specified  in  section  three  hundred 
and  nine  upon  which  the  tax  now  imposed  by  law  has  been  paid  and 
which  are  on  the  day  this  Act  is  passed  held  in  excess  of  twenty-five 
gallons  in  the  aggregate  of  such  articles  and  intended  for  sale,  there 
shall  be  levied,  collected,  and  paid  a  tax  equal  to  the  tax  imposed  by 
such  section. 

Sec.  311.  That  upon  all  grape  brandy  or  wine  spirits  withdrawn 
by  a  producer  of  wines  from  any  fruit  distillery  or  special  bonded 
warehouse  under  subdivision  (c)  of  section  four  hundred  and  two 
of  the  Act  entitled  “An  Act  to  increase  the  revenue,  and  for  other 
purposes,”  approved  September  eighth,  nineteen  hundred  and  six¬ 
teen,  there  shall  be  levied,  assessed,  collected,  and  paid  in  addition  to 
the  tax  therein  imposed,  a  tax  equal  to  double  such  tax,  to  be  as¬ 
sessed,  collected,  and  paid  under  the  provisions  of  existing  law. 

Sec.  312.  That  upon  all  sweet  wines  held  for  sale  by  the  producer 
thereof  upon  the  day  this  Act  is  passed  there  shall  be  levied,  assessed, 
collected,  and  paid  an  additional  tax  equivalent  to  10  cents  per  proof 
gallon  upon  the  grape  brandy  or  wine  spirits  used  in  the  fortification 
of  such  wine,  and  an  additional  tax  of  20  cents  per  proof  gallon  shall 
be  levied,  assessed,  collected,  and  paid  upon  all  grape  brandy  or 
wine  spirits  withdrawn  by  a  producer  of  sweet  wines  for  the  purpose 
of  fortifying  such  wines  and  not  so  used  prior  to  the  passage  of  this 
Act. 

Sec.  313.  That  there  shall  be  levied,  assessed,  collected,  and 
paid — 

(a)  Upon  all  prepared  sirups  or  extracts  (intended  for  use  in  the 
manufacture  or  production  of  beverages,  commonly  known  as  soft 
drinks,  by  soda  fountains,  bottling  establishments,  and  other  similar 
places)  sold  by  the  manufacturer,  producer,  or  importer  thereof, 
if  so  sold  for  not  more  than  $1.30  per  gallon,  a  tax  of  5  cents  per  gallon; 
if  so  sold  for  more  than  $1.30  and  not  more  than  $2  per  gallon,  a 
tax  of  8  cents  per  gallon;  if  so  sold  for  more  than  $2  and  not  more 
than  $3  per  gallon,  a  tax  of  10  cents  per  gallon;  if  so  sold  for  more  than 
$3  and  not  more  than  $4  per  gallon,  a  tax  of  15  cents  per  gallon;  and 


23 


if  so  sold  for  more  than  $4  per  gallon,  a  tax  of  20  cents  per  gallon; 
and 


(b)  Upon  all  unfermented  grape  juice,  soft  drinks  or  artificial 
mineral  waters  (not  carbonated),  and  fermented  liquors  containing 
less  than  one-half  per  centum  of  alcohol,  sold  by  the  manufacturer, 
producer,  or  importer  thereof,  in  bottles  or  other  closed  containers, 
and  upon  all  ginger  ale,  root  beer,  sarsaparilla,  pop,  and  other 
carbonated  waters  or  beverages,  manufactured  and  sold  by  the 
manufacturer,  producer,  or  importer  of  the  carbonic  acid  gas  used 
in  carbonating  the  same,  a  tax  of  1  cent  per  gallon;  and 

(c)  Upon  all  natural  mineral  waters  or  table  waters,  sold  by  the 
producer,  bottler,  or  importer  thereof,  in  bottles  or  other  closed 
containers,  at  over  10  cents  per  gallon,  a  tax  of  1  cent  per  gallon. 

Sec.  314.  That  each  such  manufacturer,  producer,  bottler,  or 
importer  shall  make  monthly  returns  under  oath  to  the  collector  of 
internal  revenue  for  the  district  in  which  is  located  the  principal 
place  of  business,  containing  such  information  necessary  for  the 
assessment  of  the  tax,  and  at  such  times  and  in  such  manner,  as  the 
Commissioner  of  Internal  Revenue,  with  the  approval  of  the  Secretary 
of  the  Treasury,  may  by  regulation  prescribe. 

Sec.  315.  That  upon  all  carbonic  acid  gas  in  drums  or  other 
containers  (intended  for  use  in  the  manufacture  or  production  of 
carbonated  water  or  other  drinks)  sold  by  the  manufacturer,  producer, 
or  importer  thereof,  there  shall  be  levied,  assessed,  collected,  and 
paid  a  tax  of  5  cents  per  pound.  Such  tax  shall  be  paid  by  the 
purchaser  to  the  vendor  thereof  and  shall  be  collected,  returned,  and 
paid  to  the  United  States  by  such  vendor  in  the  same  manner  as 
provided  in  section  five  hundred  and  three. 


TITLE  IV. — War  Tax  on  Cigars,  Tobacco,  and  Manufactures 

Thereof. 


Sec.  400.  That  upon  cigars  and  cigarettes,  which  shall  be 
manufactured  and  sold,  or  removed  for  consumption  or  sale,  there 
shall  be  levied  and  collected,  in  addition  to  the  taxes  now  imposed 
by  existing  law,  the  following  taxes,  to  be  paid  by  the  manufacturer 
or  importer  thereof:  ( a )  on  cigars  of  all  descriptions  made  of 
tobacco,  or  any  substitute  therefor,  and  weighing  not  more  than 
three  pounds  per  thousand,  25  cents  per  thousand;  (b)  on  cigars 
made  of  tobacco,  or  any  substitute  therefor,  and  weighing  more 
than  three  pounds  per  thousand,  if  manufactured  or  imported  to 
retail  at  4  cents  or  more  each,  and  not  more  than  7  cents  each,  $1 


24 


per  thousand;  (c)  if  manufactured  or  imported  to  retail  at  more 
than  7  cents  each  and  not  more  than  15  cents  each,  $3  per  thousand; 
(d)  if  manufactured  or  imported  to  retail  at  more  than  15  cents 
each  and  not  more  than  20  cents  each,  $5  per  thousand;  (e)  if  manu¬ 
factured  or  imported  to  retail  at  more  than  20  cents  each,  $7  per 
thousand:  Provided ,  That  the  word  “retail”  as  used  in  this  section 
shall  mean  the  ordinary  retail  price  of  a  single  cigar,  and  that  the 
Commissioner  of  Internal  Revenue  may,  by  regulation,  require  the 
manufacturer  or  importer  to  affix  to  each  box  or  container  a  con¬ 
spicuous  label  indicating  by  letter  the  clause  of  this  section  under 
which  the  cigars  therein  contained  have  been  tax-paid,  which  must 
correspond  with  the  tax-paid  stamp  on  said  box  or  container; 
(/)  on  cigarettes  made  of  tobacco,  or  any  substitute  therefor,  made 
in  or  imported  into  the  United  States,  and  weighing  not  more  than 
three  pounds  per  thousand,  80  cents  per  thousand;  weighing  more 
than  three  pounds  per  thousand,  $1.20  per  thousand. 

Every  manufacturer  of  cigarettes  (including  small  cigars  weighing 
not  more  than  three  pounds  per  thousand)  shall  put  up  all  the 
cigarettes  and  such  small  cigars  that  he  manufactures  or  has  manu¬ 
factured  for  him,  and  sells  or  removes  for  consumption  or  use,  in 
packages  or  parcels  containing  five,  eight,  ten,  twelve,  fifteen,  six¬ 
teen,  twenty,  twenty-four,  forty,  fifty,  eighty,  or  one  hundred 
cigarettes  each,  and  shall  securely  affix  to  each  of  said  packages  or 
parcels  a  suitable  stamp  denoting  the  tax  thereon  and  shall  properly 
cancel  the  same  prior  to  such  sale  or  removal  for  consumption  or  use 
under  such  regulations  as  the  Commissioner  of  Internal  Revenue, 
with  the  approval  of  the  Secretary  of  the  Treasury,  shall  prescribe; 
and  all  cigarettes|imported  from  a  foreign  country  shall  be  packed, 
stamped,  and  thejstamps  canceled  in  a  like  manner,  in  addition  to 
the  import  stamp  indicating  inspection  of  the  custom-house  before 
they  are  withdrawn  therefrom. 

Sec.  401.  That  upon  all  tobacco  and  snuff  hereafter  manu¬ 
factured  and  sold,  or  removed  for  consumption  or  use,  there  shall 
be  levied  and  collected,  in  addition  to  the  tax  now  imposed  by  law 
upon  such  articles,  a  tax  of  5  cents  per  pound,  to  be  levied,  collected, 
and  paid  under  the  provisions  of  existing  law. 

In  addition  to  the  packages  provided  for  under  existing  law, 
manufactured  tobacco  and  snuff  may  be  put  up  and  prepared  by  the 
manufacturer  for  sale  or  consumption,  in  packages  of  the  following 
description:  Packages  containing  one-eighth,  three-eighths,  five- 
eighths,  seven-eighths,  one  and  one-eighth,  one  and  three-eighths, 
one  and  five-eighths,  one  and  seven-eighths,  and  five  ounces. 

Sec.  402.  That  sections  four  hundred,  four  hundred  and  one,  and 
four  hundred  and  four,  shall  take  effect  thirty  days  after  the  passage 


25 


of  this  act:  Provided,  That  after  the  passage  of  this  Act  and  before 
the  expiration  of  the  aforesaid  thirty  days,  cigarettes  and  manufac¬ 
tured  tobacco  and  snuff  may  be  put  up  in  the  packages  now  provided 
for  by  law  or  in  the  packages  provided  for  in  sections  four  hundred 
and  four  hundred  and  one. 

Sec.  403.  That  there  shall  also  be  levied  and  collected,  upon 
all  manufactured  tobacco  and  snuff  in  excess  of  one  hundred  pounds 
or  upon  cigars  or  cigarettes  in  excess  of  one  thousand,  which  were 
manufactured  or  imported,  and  removed  from  factory  or  custom¬ 
house  prior  to  the  passage  of  this  Act,  bearing  tax-paid  stamps  affixed 
to  such  articles  for  the  payment  of  the  taxes  thereon,  and  which  are, 
on  the  day  after  this  Act  is  passed,  held  and  intended  for  sale  by  any 
person,  corporation,  partnership,  or  association,  and  upon  all  manu¬ 
factured  tobacco,  snuff,  cigars,  or  cigarettes,  removed  from  factory 
or  customs  house  after  the  passage  of  this  Act  but  prior  to  the  time 
when  the  tax  imposed  by  section  four  hundred  or  section  four  hun¬ 
dred  and  one  upon  such  articles  takes  effect,  an  additional  tax 
equal  to  one-half  the  tax  imposed  by  such  sections  upon  such  articles. 

Sec.  404.  That  there  shall  be  levied,  assessed,  and  collected  upon 
cigarette  paper  made  up  into  packages,  books,  sets,  or  tubes,  made 
up  in  or  imported  into  the  United  States  and  intended  for  use  by  the 
smoker  in  making  cigarettes  the  following  taxes:  On  each  package, 
book,  or  set,  containing  more  than  twenty-five  but  not  more  than 
fifty  papers,  one-half  of  1  cent;  containing  more  than  fifty  but  not 
more  than  one  hundred  papers,  1  cent;  containing  more  than  one 
hundred  papers,  1  cent  for  each  one  hundred  papers  or  fractional 
part  thereof;  and  upon  tubes,  2  cents  for  each  one  hundred  tubes  or 
fractional  part  thereof. 


TITLE  V. — War  Tax  on  Facilities  Furnished  by  Public  Utilities 

and  Insurance. 


Sec.  500.  That  from  and  after  the  first  day  of  November,  nine¬ 
teen  hundred  and  seventeen,  there  shall  be  levied,  assessed,  col¬ 
lected,  and  paid  ( a )  a  tax  equivalent  to  three  per  centum  of  the 
amount  paid  for  the  transportation  by  rail  or  water  or  by  any  form 
of  mechanical  motor  power  when  in  competition  with  carriers  by 
rail  or  water  of  property  by  freight  consigned  from  one  point  in  the 
United  States  to  another;  ( b )  a  tax  of  1  cent  for  each  20  cents,  or 
fraction  thereof,  paid  to  any  person,  corporation,  partnership,  or 
association,  engaged  in  the  business  of  transporting  parcels  or 
packages  by  express  over  regular  routes  between  fixed  terminals,  for 
the  transportation  of  any  package,  parcel,  or  shipment  by  express 
from  one  point  in  the  United  States  to  another:  Provided ,  That  noth- 

26 


ing  herein  contained  shall  be  construed  to  require  the  carrier  collecting 
such  tax  to  list  separately  in  any  bill  of  lading,  freight  receipt,  or 
other  similar  document,  the  amount  of  the  tax  herein  levied,  if  the 
total  amount  of  the  freight  and  tax  be  therein  stated;  (c)  a  tax 
equivalent  to  eight  per  centum  of  the  amount  paid  for  the  transporta¬ 
tion  of  persons  by  rail  or  water,  or  by  any  form  of  mechanical  motor 
power  on  a  regular  established  line  when  in  competition  with  carriers 
by  rail  or  water,  from  one  point  in  the  United  States  to  another  or  to 
any  point  in  Canada  or  Mexico,  where  the  ticket  therefor  is  sold  or 
issued  in  the  United  States,  not  including  the  amount  paid  for  com¬ 
mutation  or  season  tickets  for  trips  less  than  thirty  miles,  or  for 
transportation  the  fare  for  which  does  not  exceed  35  cents,  and  a  tax 
equivalent  to  ten  per  centum  of  the  amount  paid  for  seats,  berths, 
and  staterooms  in  parlor  cars,  sleeping  cars,  or  on  vessels.  If  a  mile¬ 
age  book  used  for  such  transportation  or  accommodation  has  been 
purchased  before  this  section  takes  effect,  or  if  cash  fare  be  paid,  the 
tax  imposed  by  this  section  shall  be  collected  from  the  person  present¬ 
ing  the  mileage  book,  or  paying  the  cash  fare,  by  the  conductor  or 
other  agent,  when  presented  for  such  transportation  or  accommoda¬ 
tion,  and  the  amount  so  collected  shall  be  paid  to  the  United  States  in 
such  manner  and  at  such  times  as  the  Commissioner  of  Internal  Reve¬ 
nue,  with  the  approval  of  the  Secretary  of  the  Treasury,  may  pre¬ 
scribe;  if  a  ticket  (other  than  a  mileage  book)  is  bought  and  partially 
used  before  this  section  goes  into  effect  it  shall  not  be  taxed,  but  if 
bought  but  not  so  used  before  this  section  takes  effect,  it  shall  not  be 
valid  for  passage  until  the  tax  has  been  paid  and  such  payment  evi¬ 
denced  on  the  ticket  in  such  manner  as  the  Commissioner  of  Internal 
Revenue,  with  the  approval  of  the  Secretary  of  the  Treasury,  may  by 
regulation  prescribe;  (d)  a  tax  equivalent  to  five  per  centum  of  the 
amount  paid  for  the  transportation  of  oil  by  pipe  line;  (e)  a  tax  of  5 
cents  upon  each  telegraph,  telephone,  or  radio,  dispatch,  message,  or 
conversation,  which  originates  within  the  United  States,  and  for 
the  transmission  of  which  a  charge  of  15  cents  or  more  is  imposed: 
Provided ,  That  only  one  payment  of  such  tax  shall  be  required,  not¬ 
withstanding  the  lines  or  stations  of  one  or  more  persons,  corpora¬ 
tions,  partnerships,  or  associations  shall  be  used  for  the  transmission 
of  such  dispatch,  message,  or  conversation. 

Sec.  501.  That  the  taxes  imposed  by  section  five  hundred  shall 
be  paid  by  the  person,  corporation,  partnership,  or  association 
paying  for  the  services  or  facilities  rendered. 

In  case  such  carrier  does  not,  because  of  its  ownership  of  the 
commodity  transported,  or  for  any  other  reason,  receive  the  amount 
which  as  a  carrier  it  would  otherwise  charge,  such  carrier  shall  pay  a 
tax  equivalent  to  the  tax  which  would  be  imposed  upon  the  trans¬ 
portation  of  such  commodity  if  the  carrier  received  payment  for 
such  transportation:  Provided ,  That  in  case  of  a  carrier  which  on 


27 


May  first,  nineteen  hundred  and  seventeen,  had  no  rates  or  tariffs 
on  file  with  the  proper  Federal  or  State  authority,  the  tax  shall  be 
computed  on  the  basis  of  the  rates  or  tariffs  of  other  carriers  for  like 
services  as  ascertained  and  determined  by  the  Commissioner  of 
Internal  Revenue:  Provided ,  further ,  That  nothing  in  this  or  the 
preceding  section  shall  be  construed  as  imposing  a  tax  ( a )  upon  the 
transportation  of  any  commodity  which  is  necessary  for  the  use  of 
the  carrier  in  the  conduct  of  its  business  as  such  and  is  intended  to  be 
so  used  or  has  been  so  used;  or  ( b )  upon  the  transportation  of  com¬ 
pany  material  transported  by  one  carrier,  which  constitutes  a  part 
of  a  railroad  system,  for  another  carrier  which  is  also  a  part  of  the 
same  system. 

Sec.  502.  That  no  tax  shall  be  imposed  under  section  five 
hundred  upon  any  payment  received  for  services  rendered  to  the 
United  States,  or  any  State,  Territory,  or  the  District  of  Columbia. 
The  right  to  exemption  under  this  section  shall  be  evidenced  in 
such  manner  as  the  Commissioner  of  Internal  Revenue,  with  the 
approval  of  the  Secretary  of  the  Treasury,  may  by  regulation 
prescribe. 

Sec.  503.  That  each  person,  corporation,  partnership,  or  asso¬ 
ciation  receiving  any  payments  referred  to  in  section  five  hundred 
shall  collect  the  amount  of  the  tax,  if  any,  imposed  by  such  section 
from  the  person,  corporation,  partnership,  or  association  making 
such  payments,  and  shall  make  monthly  returns  under  oath,  in 
duplicate,  and  pay  the  taxes  so  collected  and  the  taxes  imposed  upon 
it  under  paragraph  two  of  section  five  hundred  and  one  to  the  col¬ 
lector  of  internal  revenue  of  the  district  in  which  the  principal  office 
or  place  of  business  is  located.  Such  returns  shall  contain  such 
information,  and  be  made  in  such  manner,  as  the  Commissioner 
of  Internal  Revenue,  with  the  approval  of  the  Secretary  of  the 
Treasury,  may  by  regulation  prescribe. 

Sec.  504.  That  from  and  after  the  first  day  of  November,  nine¬ 
teen  hundred  and  seventeen,  there  shall  be  levied,  assessed,  collected, 
and  paid  the  following  taxes  on  the  issuance  of  insurance  policies: 

(a)  Life  insurance:  A  tax  equivalent  to  8  cents  on  each  $100 
or  fractional  part  thereof  of  the  amount  for  which  any  life  is  insured 
under  any  policy  of  insurance,  or  other  instrument,  by  whatever 
name  the  same  is  called:  Provided ,  That  on  all  policies  for  life  insur¬ 
ance  only  by  which  a  life  is  insured  not  in  excess  of  $500,  issued  on 
the  industrial  or  weekly  payment  plan  of  insurance,  the  tax  shall  be 
forty  per  centum  of  the  amount  of  the  first  weekly  premium:  Pro¬ 
vided  further,  That  policies  of  reinsurance  shall  be  exempt  from  the 
tax  imposed  by  this  subdivision; 


28 


(b)  Marine,  inland,  and  fire  insurance:  A  tax  equivalent  to  1  cent 
on  each  dollar  or  fractional  part  thereof  of  the  premium  charged 
under  each  policy  of  insurance  or  other  instrument  by  whatever 
name  the  same  is  called  whereby  insurance  is  made  or  renewed  upon 
property  of  any  description  (including  rents  or  profits),  whether 
against  peril  by  sea  or  inland  waters,  or  by  fire  or  lightning,  or  other 
peril:  Provided ,  That  policies  of  reinsurance  shall  be  exempt  from 
the  tax  imposed  by  this  subdivision. 

(c)  Casualty  insurance:  A  tax  equivalent  to  1  cent  on  each 
dollar  or  fractional  part  thereof  of  the  premium  charged  under  each 
policy  of  insurance  or  obligation  of  the  nature  of  indemnity  for  loss, 
damage,  or  liability  (except  bonds  taxable  under  subdivision  two  of 
Schedule  A  of  Title  VIII)  issued  or  executed  or  renewed  by  any 
person,  corporation,  partnership,  or  association,  transacting  the 
business  of  employer’s  liability,  workmen’s  compensation,  accident, 
health,  tornado,  plate  glass,  steam  boiler,  elevator,  burglary,  auto¬ 
matic  sprinkler,  automobile,  or  other  branch  of  insurance  (except 
life  insurance,  and  insurance  described  and  taxed  in  the  preceding 
subdivision) :  Provided ,  That  policies  of  reinsurance  shall  be  exempt 
from  the  tax  imposed  by  this  subdivision; 

(d)  Policies  issued  by  any  person,  corporation,  partnership,  or 
association,  whose  income  is  exempt  from  taxation  under  Title  I 
of  the  Act  entitled  “An  Act  to  increase  the  revenue,  and  for  other 
purposes,”  approved  September  eighth,  nineteen  hundred  and 
sixteen,  shall  be  exempt  from  the  taxes  imposed  by  this  section. 

Sec.  505.  That  every  person,  corporation,  partnership,  or  asso¬ 
ciation,  issuing  policies  of  insurance  upon  the  issuance  of  which  a  tax 
is  imposed  by  section  five  hundred  and  four,  shall,  within  the  first 
fifteen  days  of  each  month,  make  a  return  under  oath,  in  duplicate, 
and  pay  such  tax  to  the  collector  of  Internal  Revenue  of  the  district 
in  which  the  principal  office  or  place  of  business  of  such  person,  cor¬ 
poration,  partnership,  or  association  is  located.  Such  returns  shall 
contain  such  information  and  be  made  in  such  manner  as  the  Com¬ 
missioner  of  Internal  Revenue,  with  the  approval  of  the  Secretary 
of  the  Treasury,  may  by  regulation  prescribe. 


TITLE  VI. — War  Excise  Taxes. 

Sec.  600.  That  there  shall  be  levied,  assessed,  collected,  and 
paid — 

(a)  Upon  all  automobiles,  automobile  trucks,  automobile 
wagons,  and  motorcycles,  sold  by  the  manufacturer,  producer, 
or  importer,  a  tax  equivalent  to  three  per  centum  of  the  price  for 
which  so  sold;  and 


29 


( b )  Upon  all  piano  players,  graphophones,  phonographs,  talking 
machines,  and  records  used  in  connection  with  any  musical  instru¬ 
ment,  piano  player,  graphophone,  phonograph,  or  talking  machine, 
sold  by  the  manufacturer,  producer,  or  importer,  a  tax  equivalent 
to  three  per  centum  of  the  price  for  which  so  sold;  and 

(c)  Upon  all  moving-picture  films  (which  have  not  been  exposed) 
sold  by  the  manufacturer  or  importer,  a  tax  equivalent  to  one- 
fourth  of  1  cent  per  linear  foot;  and 

(d)  Upon  all  positive  moving-picture  films  (containing  a  picture 
ready  for  projection)  sold  or  leased  by  the  manufacturer,  producer, 
or  importer,  a  tax  equivalent  to  one-half  of  1  cent  per  linear  foot; 
and 

(e)  Upon  any  article  commonly  or  commercially  known  as 
jewelry,  whether  real  or  imitation,  sold  by  the  manufacturer,  pro¬ 
ducer,  or  importer  thereof,  a  tax  equivalent  to  three  per  centum 
of  the  price  for  which  so  sold;  and 

(f)  Upon  all  tennis  rackets,  golf  clubs,  baseball  bats,  lacrosse 
sticks,  balls  of  all  kinds,  including  baseballs,  foot  balls,  tennis,  golf, 
lacrosse,  billiard  and  pool  balls,  fishing  rods  and  reels,  billiard  and 
pool  tables,  chess  and  checker  boards  and  pieces,  dice,  games  and 
parts  of  games,  except  playing  cards  and  children’s  toys  and  games, 
sold  by  the  manufacturer,  producer,  or  importer,  a  tax  equivalent  to 
three  per  centum  of  the  price  for  which  so  sold;  and 

(&)  Upon  all  perfumes,  essences,  extracts,  toilet  waters,  cosmetics, 
petroleum  jellies,  hair  oils,  pomades,  hair  dressings,  hair  restoratives, 
hair  dyes,  tooth  and  mouth  washes,  dentrifrices,  tooth  pastes, 
aromatic  cachous,  toilet  soaps  and  powders,  or  any  similar  sub¬ 
stance,  article,  or  preparation  by  whatsoever  name  known  or  dis¬ 
tinguished,  upon  all  of  the  above  which  are  used  or  applied  or 
intended  to  be  used  or  applied  for  toilet  purposes,  and  which  are 
sold  by  the  manufacturer,  importer,  or  producer,  a  tax  equivalent 
to  two  per  centum  of  the  price  for  which  so  sold;  and 

(Ji)  Upon  all  pills,  tablets,  powders,  tinctures,  troches  or  lozenges, 
sirups,  medicinal  cordials  or  bitters,  anodynes,  tonics,  plasters, 
liniments,  salves,  ointments,  pastes,  drops,  waters  (except  those 
taxed  under  section  three  hundred  and  thirteen  of  this  Act),  essences, 
spirits,  oils,  and  all  medicinal  preparations,  compounds,  or  com¬ 
positions  whatsoever,  the  manufacturer  or  producer  of  which  claims 
to  have  any  private  formula,  secret,  or  occult  art  for  making  or 
preparing  the  same,  or  has  or  claims  to  have  any  exclusive  right  or 
title  to  the  making  or  preparing  the  same,  or  which  are  prepared, 
uttered,  vended,  or  exposed  for  sale  under  any  letters  patent,  or 
trade-mark,  or  which,  if  prepared  by  any  formula,  published  or 


30 


unpublished,  are  held  out  or  recommended  to  the  public  by  the 
makers,  venders,  or  proprietors  thereof  as  proprietary  medicines  or 
medicinal  proprietary  articles  or  preparations,  or  as  remedies  or 
specifics  for  any  disease,  diseases,  or  affection  whatever  affecting 
the  human  or  animal  body,  and  which  are  sold  by  the  manufacturer, 
producer,  or  importer,  a  tax  equivalent  to  two  per  centum  of  the 
price  for  which  so  sold;  and 

(i)  Upon  all  chewing  gum  or  substitute  therefor  sold  by  the  man¬ 
ufacturer,  producer,  or  importer,  a  tax  equivalent  to  two  per  centum 
of  the  price  for  which  so  sold;  and 

(/)  Upon  all  cameras  sold  by  the  manufacturer,  producer,  or 
importer,  a  tax  equivalent  to  three  per  centum  of  the  price  for  which 
so  sold. 

Sec.  601.  That  each  manufacturer,  producer,  or  importer  of 
any  of  the  articles  enumerated  in  section  six  hundred  shall  make 
monthly  returns  under  oath  in  duplicate  and  pay  the  taxes  imposed 
on  such  articles  by  this  title  to  the  collector  of  internal  revenue 
for  the  district  in  which  is  located  the  principal  place  of  business. 
Such  returns  shall  contain  such  information  and  be  made  at  such 
times  and  in  such  manner  as  the  Commissioner  of  Internal  Revenue, 
with  the  approval  of  the  Secretary  of  the  Treasury,  may  by  regulations 
prescribe. 

Sec.  602.  That  upon  all  articles  enumerated  in  subdivisions 
(a),  (b)y  (e)y  ( f ),  (g),  (h)y  (t),  or  (/)  of  section  six  hundred,  which  on 
the  day  this  Act  is  passed  are  held  and  intended  for  sale  by  any 
person,  corporation,  partnership,  or  association,  other  than  (1)  a 
retailer  who  is  not  also  a  wholesaler,  or  (2)  the  manufacturer,  pro¬ 
ducer,  or  importer  thereof,  there  shall  be  levied,  assessed,  collected, 
and  paid,  a  tax  equivalent  to  one-half  the  tax  imposed  by  each 
such  subdivision  upon  the  sale  of  the  articles  therein  enumerated. 
This  tax  shall  be  paid  by  the  person,  corporation,  partnership, 
or  association  so  holding  such  articles. 

The  taxes  imposed  by  this  section  shall  be  assessed,  collected, 
and  paid  in  the  same  manner  as  provided  in  section  ten  hundred 
and  two  in  the  case  of  additional  taxes  upon  articles  upon  which 
the  tax  imposed  by  existing  law  has  been  paid. 

Nothing  in  this  section  shall  be  construed  to  impose  a  tax  upon 
articles  sold  and  delivered  prior  to  May  ninth,  nineteen  hundred 
and  seventeen,  where  the  title  is  reserved  in  the  vendor  as  security 
for  the  payment  of  the  purchase  money. 

Sec.  603.  That  on  the  day  this  Act  takes  effect,  and  thereafter 
on  July  first  in  each  year,  and  also  at  the  time  of  the  original  pur- 

31 


chase  of  a  new  boat  by  a  user,  if  on  any  other  date  than  July  first, 
there  shall  be  levied,  assessed,  collected,  and  paid,  upon  the  use  of 
yachts,  pleasure  boats,  power  boats,  and  sailing  boats,  of  over  five  net 
tons,  and  motor  boats  with  fixed  engines,  not  used  exclusively  for  trade 
or  national  defense,  or  not  built  according  to  plans  and  specifications 
approved  by  the  Navy  Department,  an  excise  tax  to  be  based  on 
each  yacht  or  boat,  at  rates  as  follows:  Yachts,  pleasure  boats, 
power  boats,  motor  boats  with  fixed  engines,  and  sailing  boats,  of 
over  five  net  tons,  length  not  over  fifty  feet,  50  cents  for  each  foot, 
length  over  fifty  feet  and  not  over  one  hundred  feet,  $1  for  each  foot, 
length  over  one  hundred  feet,  $2  for  each  foot;  motor  boats  of  not 
over  five  net  tons  with  fixed  engines,  $5. 

In  determining  the  length  of  such  yachts,  pleasure  boats,  power 
boats,  motor  boats  with  fixed  engines,  and  sailing  boats,  the  measure¬ 
ment  of  over-all  length  shall  govern. 

In  the  case  of  a  tax  imposed  at  the  time  of  the  original  purchase 
of  a  new  boat  on  any  other  date  than  July  first,  the  amount  to  be  paid 
shall  be  the  same  number  of  twelfths  of  the  amount  of  the  tax  as  the 
number  of  calendar  months,  including  the  month  of  sale,  remaining 
prior  to  the  following  July  first. 


TITLE  VII. — -War  Tax  on  Admissions  and  Dues. 


Sec.  700.  That  from  and  after  the  first  day  of  November,  nine¬ 
teen  hundred  and  seventeen,  there  shall  be  levied,  assessed,  collected, 
and  paid,  (a)  a  tax  of  1  cent  for  each  10  cents  or  fraction  thereof 
of  the  amount  paid  for  admission  to  any  place,  including  admission 
by  season  ticket  or  subscription,  to  be  paid  by  the  person  paying 
for  such  admission:  Provided ,  That  the  tax  on  admission  of  children 
under  twelve  years  of  age  where  an  admission  charge  for  such  children 
is  made  shall  in  every  case  be  1  cent;  and  (b)  in  the  case  of  persons 
(except  bona  fide  employees,  municipal  officers  on  official  business, 
and  children  under  twelve  years  of  age)  admitted  free  to  any  place 
at  a  time  when  and  under  circumstances  under  which  an  admission 
charge  is  made  to  other  persons  of  the  same  class,  a  tax  of  1  cent 
for  each  10  cents  or  fraction  thereof  of  the  price  so  charged  to  such 
other  persons  for  the  same  or  similar  accommodations,  to  be  paid 
by  the  persons  so  admitted;  and  (c)  a  tax  of  1  cent  for  each  10  cents 
or  fraction  thereof  paid  for  admission  to  any  public  performance 
for  profit  at  any  cabaret  or  other  similar  entertainment  to  which  the 
charge  for  admission  is  wholly  or  in  part  included  in  the  price  paid  for 
refreshment,  service,  or  merchandise;  the  amount  paid  for  such 
admission  to  be  computed  under  rules  prescribed  by  the  Commissioner 
of  Internal  Revenue,  with  the  approval  of  the  Secretary  of  the 

32 


Treasury,  such  tax  to  be  paid  by  the  person  paying  for  such  refresh¬ 
ment,  service,  or  merchandise.  In  the  case  of  persons  having  the 
permanent  use  of  boxes  or  seats  in  an  opera  house  or  any  place  of 
amusement  or  a  lease  for  the  use  of  such  box  or  seat  in  such  opera 
house  or  place  of  amusement  there  shall  be  levied,  assessed,  collected, 
and  paid  a  tax  equivalent  to  ten  per  centum  of  the  amount  for  which 
a  similar  box  or  seat  is  sold  for  performance  or  exhibition  at  which 
the  box  or  seat  is  used  or  reserved  by  or  for  the  lessee  or  holder. 
These  taxes  shall  not  be  imposed  in  the  case  of  a  place  the  maxi¬ 
mum  charge  for  admission  to  which  is  5  cents,  or  in  the  case  of 
shows,  rides,  and  other  amusements,  (the  maximum  charge  for  ad¬ 
mission  to  which  is  ten  cents)  within  outdoor  general  amusement 
parks,  or  in  the  case  of  admissions  to  such  parks. 

No  tax  shall  be  levied  under  this  title  in  respect  to  any  admis¬ 
sions  all  the  proceeds  of  which  inure  exclusively  to  the  benefit  of 
religious,  educational,  or  charitable  institutions,  societies,  or  organ¬ 
izations,  or  admissions  to  agricultural  fairs,  none  of  the  profits  of 
which  are  distributed  to  stockholders  or  members  of  the  association 
conducting  the  same. 

The  term  “admission”  as  used  in  this  title  includes  seats  and 
tables,  reserved  or  otherwise,  and  other  similar  accommodations, 
and  the  charges  made  therefor. 

Sec.  701.  That  from  and  after  the  first  day  of  November,  nine¬ 
teen  hundred  and  seventeen,  there  shall  be  levied,  assessed,  collected, 
and  paid,  a  tax  equivalent  to  ten  per  centum  of  any  amount  paid  as 
dues  or  membership  fees  (including  initiation  fees),  to  any  social, 
athletic,  or  sporting  club  or  organization,  where  such  dues  or  fees 
are  in  excess  of  $12  per  year;  such  taxes  to  be  paid  by  the  person 
paying  such  dues  or  fees:  provided,  that  there  shall  be  exempted 
from  the  provisions  of  this  section  all  amounts  paid  as  dues  or  fees 
to  a  fraternal  beneficiary  society,  order,  or  association,  operating 
under  the  lodge  system  or  for  the  exclusive  benefit  of  the  members 
of  a  fraternity  itself  operating  under  the  lodge  system,  and  providing 
for  the  payment  of  life,  sick,  accident,  or  other  benefits  to  the  mem¬ 
bers  of  such  society,  order,  or  association  or  their  dependents. 

Sec.  702.  That  every  person,  corporation,  partnership,  or  asso¬ 
ciation  ( a )  receiving  any  payments  for  such  admission,  dues,  or  fees 
shall  collect  the  amount  of  the  tax  imposed  by  section  seven 
hundred  or  seven  hundred  and  one  from  the  person  making  such 
payments,  or  ( b )  admitting  any  person  free  to  any  place  for  admis¬ 
sion  to  which  a  charge  is  made  shall  collect  the  amount  of  the  tax 
imposed  by  section  seven  hundred  from  the  person  so  admitted,  and 
(c)  in  either  case  shall  make  returns  and  payments  of  the  amounts 
so  collected,  at  the  same  time  and  in  the  same  manner  as  provided  in 
section  five  hundred  and  three  of  this  Act. 

33 


TITLE  VIII. — War  Stamp  Taxes. 


Sec.  800.  That  on  and  after  the  first  day  of  December,  nineteen 
hundred  and  seventeen,  there  shall  be  levied,  collected,  and  paid, 
for  and  in  respect  of  the  several  bonds,  debentures,  or  certificates  of 
stock  and  of  indebtedness,  and  other  documents,  instruments, 
matters,  and  things  mentioned  and  described  in  Schedule  A  of  this 
title,  or  for  or  in  respect  of  the  vellum,  parchment,  or  paper  upon 
which  such  instruments,  matters,  or  things,  or  any  of  them,  are 
written  or  printed,  by  any  person,  corporation,  partnership,  or 
association  who  makes,  signs,  issues,  sells,  removes,  consigns,  or 
ships  the  same,  or  for  whose  use  or  benefit  the  same  are  made,  signed, 
issued,  sold,  removed,  consigned,  or  shipped,  the  several  taxes  specified 
in  such  schedule. 

Sec.  801.  That  there  shall  not  be  taxed  under  this  title  any  bond, 
note,  or  other  instrument,  issued  by  the  United  States,  or  by  any 
foreign  Government,  or  by  any  State,  Territory,  or  the  District  of 
Columbia,  or  local  subdivision  thereof,  or  municipal  or  other  cor¬ 
poration  exercising  the  taxing  power,  when  issued  in  the  exercise  of  a 
strictly  governmental,  taxing,  or  municipal  function;  or  stocks  and 
bonds  issued  by  co-operative  building  and  loan  associations  which 
are  organized  and  operated  exclusively  for  the  benefit  of  their  members 
and  make  loans  only  to  their  shareholders,  or  by  mutual  ditch  or 
irrigating  companies. 

Sec.  802.  That  whoever — 

(i a )  Makes,  signs,  issues,  or  accepts,  or  causes  to  be  made,  signed, 
issued,  or  accepted,  any  instrument,  document,  or  paper  of  any 
kind  or  description  whatsoever  without  the  full  amount  of  tax  there¬ 
on  being  duly  paid; 

(b)  Consigns  or  ships,  or  causes  to  be  consigned  or  shipped,  by 
parcel  post  any  parcel,  package,  or  article  without  the  full  amount 
of  tax  being  duly  paid; 

( c )  Manufactures  or  imports  and  sells,  or  offers  for  sale,  or 
causes  to  be  manufactured  or  imported  and  sold,  or  offered  for  sale, 
any  playing  cards,  package,  or  other  article  without  the  full  amount 
of  tax  being  duly  paid; 

(d)  Makes  use  of  an  adhesive  stamp  to  denote  any  tax  imposed 
by  this  title  without  canceling  or  obliterating  such  stamp  as  pre¬ 
scribed  in  section  eight  hundred  and  four; 

Is  guilty  of  a  misdemeanor  and  upon  conviction  thereof  shall 
pay  a  fine  of  not  more  than  $100  for  each  offense. 


34 


Sec.  803.  That  whoever — 

(a)  Fraudulently  cuts,  tears,  or  removes  from  any  vellum,  parch¬ 
ment,  paper,  instrument,  writing,  package,  or  article,  upon  which 
any  tax  is  imposed  by  this  title,  any  adhesive  stamp  or  the  impression 
of  any  stamp,  die,  plate,  or  other  article  provided,  made,  or  used  in 
pursuance  of  this  title;  ( b )  Fraudulently  uses,  joins,  fixes,  or  places 
to,  with,  or  upon  any  vellum,  parchment,  paper,  instrument,  writing, 
package,  or  article,  upon  which  any  tax  is  imposed  by  this  title, 
(1)  any  adhesive  stamp,  or  the  impression  of  any  stamp,  die,  plate, 
or  other  article,  which  has  been  cut,  torn,  or  removed  from  any  other 
vellum,  parchment,  paper,  instrument,  writing,  package,  or  article, 
upon  which  any  tax  is  imposed  by  this  title  or  (2)  any  adhesive  stamp 
or  the  impression  of  any  stamp,  die,  plate,  or  other  article  of  in¬ 
sufficient  value;  or  (3)  any  forged  or  counterfeit  stamp,  or  the  impres¬ 
sion  of  any  forged  or  counterfeited  stamp,  die,  plate,  or  other  article; 

(c)  Willfully  removes,  or  alters  the  cancellation,  or  defacing 
marks  of,  or  otherwise  prepares,  any  adhesive  stamp,  with  intent 
to  use,  or  cause  the  same  to  be  used,  after  it  has  been  already  used, 
or  knowingly  or  willfully  buys,  sells,  offers  for  sale,  or  gives  away, 
any  such  washed  or  restored  stamp  to  any  person  for  use,  or  know¬ 
ingly  uses  the  same; 

(d)  Knowingly  and  without  lawful  excuse  (the  burden  of  proof 
of  such  excuse  being  on  the  accused)  has  in  possession  any  washed, 
restored,  or  altered  stamp,  which  has  been  removed  from  any  vellum, 
parchment,  paper,  instrument,  writing,  package,  or  article, 

is  guilty  of  a  misdemeanor,  and  upon  conviction  shall  be  punished 
by  a  fine  of  not  more  than  $1,000,  or  by  imprisonment  for  not  more 
than  five  years,  or  both,  in  the  discretion  of  the  court,  and  any  such 
reused,  canceled,  or  counterfeit  stamp  and  the  vellum,  parchment, 
document,  paper,  package,  or  article  upon  which  it  is  placed  or 
impressed  shall  be  forfeited  to  the  United  States. 

Sec.  804.  That  whenever  an  adhesive  stamp  is  used  for  denoting 
any  tax  imposed  by  this  title,  except  as  hereinafter  provided,  the 
person,  corporation,  partnership,  or  association  using  or  affixing 
the  same  shall  write  or  stamp  or  cause  to  be  written  or  stamped 
thereupon  the  initials  of  his  or  its  name  and  the  date  upon  which 
the  same  is  attached  or  used,  so  that  the  same  may  not  again  be  used: 
Provided ,  That  the  Commissioner  of  Internal  Revenue  may  prescribe 
such  other  method  for  the  cancellation  of  such  stamps  as  he  may 
deem  expedient. 

Sec.  805.  (a)  That  the  Commissioner  of  Internal  Revenue  shall 

cause  to  be  prepared  and  distributed  for  the  payment  of  the  taxes 
prescribed  in  this  title  suitable  stamps  denoting  the  tax  on  the 
document,  articles,  or  thing  to  which  the  same  may  be  affixed,  and 
shall  prescribe  such  method  for  the  affixing  of  said  stamps  in  sub¬ 
stitution  for  or  in  addition  to  the  method  provided  in  this  title,  as 
he  may  deem  expedient. 


35 


(b)  The  Commissioner  of  Internal  Revenue,  with  the  approval 
of  the  Secretary  of  the  Treasury,  is  authorized  to  procure  any  of  the 
stamps  provided  for  in  this  title  by  contract  whenever  such  stamps 
can  not  be  speedily  prepared  by  the  Bureau  of  Engraving  and 
Printing;  but  this  authority  shall  expire  on  the  first  day  of  January, 
nineteen  hundred  and  eighteen,  except  as  to  imprinted  stamps 
furnished  under  contract,  authorized  by  the  Commissioner  of  In¬ 
ternal  Revenue. 

( c )  All  .internal-revenue  laws  relating  to  the  assessment  and 
collection  of  taxes  are  hereby  extended  to  and  made  a  part  of  this 
title,  so  far  as  applicable,  for  the  purpose  of  collecting  stamp  taxes 
omitted  through  mistake  or  fraud  from  any  instrument,  document, 
paper,  writing,  parcel,  package,  or  article  named  herein. 

Sec.  806.  That  the  Commissioner  of  Internal  Revenue  shall 
furnish  to  the  Postmaster  General  without  prepayment  a  suitable 
quantity  of  adhesive  stamps  to  be  distributed  to  and  kept  on  sale  by 
the  various  postmasters  in  the  United  States.  The  Postmaster 
General  may  require  each  such  postmaster  to  give  additional  or 
increased  bond  as  postmaster  for  the  value  of  the  stamps  so  furnished, 
and  each  such  postmaster  shall  deposit  the  receipts  from  the  sale  of 
such  stamps  to  the  credit  of  and  render  accounts  to  the  Postmaster 
General  at  such  times  and  in  such  form  as  he  may  by  regulations 
prescribe.  The  Postmaster  General  shall  at  least  once  monthly 
transfer  all  collections  from  this  source  to  the  Treasury  as  internal- 
revenue  collections. 

Sec.  807.  That  the  collectors  of  the  several  districts  shall 
furnish  without  prepayment  to  any  assistant  treasurer  or  designated 
depositary  of  the  United  States  located  in  their  respective  collection 
districts  a  suitable  quantity  of  adhesive  stamps  for  sale.  In  such 
cases  the  collector  may  require  a  bond,  with  sufficient  sureties,  to 
an  amount  equal  to  the  value  of  the  adhesive  stamps  so  furnished, 
conditioned  for  the  faithful  return,  whenever  so  required,  of  all 
quantities  or  amounts  undisposed  of,  and  for  the  payment  monthly 
of  all  quantities  or  amounts  sold  or  not  remaining  on  hand.  The 
Secretary  of  the  Treasury  may  from  time  to  time  make  such  regu¬ 
lations  as  he  may  find  necessary  to  insure  the  safe-keeping  or  prevent 
the  illegal  use  of  all  such  adhesive  stamps. 

SCHEDULE  A. — Stamp  Taxes. 

1.  Bonds  of  indebtedness:  Bonds,  debentures,  or  certificates  of 
indebtedness  issued  on  and  after  the  first  day  of  December,  nine¬ 
teen  hundred  and  seventeen,  by  any  person,  corporation,  partnership, 
or  association,  on  each  $100  of  face  value  or  fraction  thereof,  5  cents: 
Provided ,  That  every  renewal  of  the  foregoing  shall  be  taxed  as  a 
new  issue:  Provided  further,  That  when  a  bond  conditioned  for  the 
repayment  or  payment  of  money  is  given  in  a  penal  sum  greater 
than  the  debt  secured,  the  tax  shall  be  based  upon  the  amount 
secured. 


36 


2.  Bonds,  indemnity  and  surety:  Bonds  for  indemnifying  any 
person,  corporation,  partnership,  or  corporation  who  shall  have  be¬ 
come  bound  or  engaged  as  surety,  and  all  bonds  for  the  due  execu¬ 
tion  or  performance  of  any  contract,  obligation,  or  requirement,  or 
the  duties  of  any  office  or  position,  and  to  account  for  money  received 
by  virtue  thereof,  and  all  other  bonds  of  any  description,  except 
such  as  may  be  required  in  legal  proceedings,  not  otherwise  provided 
for  in  this  schedule,  50  cents:  Provided,  That  where  a  premium  is 
charged  for  the  execution  of  such  bonds  the  tax  shall  be  paid  at  the 
rate  of  one  per  centum  on  each  dollar  or  fractional  part  thereof  of  the 
premium  charged:  Provided  further,  That  policies  of  reinsurance 
shall  be  exempt  from  the  tax  imposed  by  this  subdivision. 

3.  Capital  stock,  issue:  On  each  original  issue,  whether  on 
organization  or  reorganization,  of  certificates  of  stock  by  any  asso¬ 
ciation,  company,  or  corporation,  on  each  $100  of  face  value  or 
fraction  thereof,  5  cents:  Provided ,  That  where  capital  stock  is 
issued  without  face  value,  the  tax  shall  be  5  cents  per  share,  unless 
the  actual  value  is  in  excess  of  $100  per  share,  in  wThich  case  the  tax 
shall  be  5  cents  on  each  $100  of  actual  value  or  fraction  thereof. 

The  stamps  representing  the  tax  imposed  by  this  subdivision  shall 
be  attached  to  the  stock  books  and  not  to  the  certificates  issued. 

4.  Capital  stock,  sales  or  transfers:  On  all  sales,  or  agreements 
to  sell,  or  memoranda  of  sales  or  deliveries  of,  or  transfers  of  legal 
title  to  shares  or  certificates  of  stock  in  any  association,  companv,  or 
corporation,  whether  made  upon  or  shown  by  the  books  of  the 
association,  company,  or  corporation,  or  by  any  assignment  in  blank, 
or  by  any  delivery,  or  by  any  paper  or  agreement  or  memorandum 
or  other  evidence  of  transfer  or  sale,  whether  entitling  the  holder  in 
any  manner  to  the  benefit  of  such  stock  or  not,  on  each  $100  of  face 
value  or  fraction  thereof,  2  cents,  and  where  such  shares  of  stock 
are  without  par  value,  the  tax  shall  be  2  cents  on  the  transfer  or  sale 
or  agreement  to  sell  on  each  share,  unless  the  actual  value  thereof 
is  in  excess  of  $100  per  share,  in  which  case  the  tax  shall  be  2  cents 
on  each  $100  of  actual  value  or  fraction  thereof:  Provided ,  That 
it  is  not  intended  by  this  title  to  impose  a  tax  upon  an  agreement 
evidencing  a  deposit  of  stock  certificates  as  collateral  security  for 
money  loaned  thereon,  which  stock  certificates  are  not  actually 
sold,  nor  upon  such  stock  certificates  so  deposited:  Provided  further , 
That  the  tax  shall  not  be  imposed  upon  deliveries  or  transfers  to  a 
broker  for  sale,  nor  upon  deliveries  or  transfers  by  a  broker  to  a 
customer  for  whom  and  upon  whose  order  he  has  purchased  same, 
but  such  deliveries  or  transfers  shall  be  accompanied  by  a  certificate 
setting  forth  the  facts:  Provided  further,  That  in  case  of  sale  where 
the  evidence  of  transfer  is  shown  only  by  the  books  of  the  company 
the  stamp  shall  be  placed  upon  such  books;  and  where  the  change 
of  ownership  is  by  transfer  of  the  certificate  the  stamp  shall  be 
placed  upon  the  certificate;  and  in  cases  of  an  agreement  to  sell 

37 


or  where  the  transfer  is  by  delivery  of  the  certificate  assigned  in 
blank  there  shall  be  made  and  delivered  by  the  seller  to  the  buyer 
a  bill  or  memorandum  of  such  sale,  to  which  the  stamp  shall  be  affixed; 
and  every  bill  or  memorandum  of  sale  or  agreement  to  sell  before 
mentioned  shall  show  the  date  thereof,  the  name  of  the  seller,  the 
amount  of  the  sale,  and  the  matter  or  thing  to  which  it  refers.  Any 
person  or  persons  liable  to  pay  the  tax  as  herein  provided,  or  anyone 
who  acts  in  the  matter  as  agent  or  broker  for  such  person  or  persons 
who  shall  make  any  such  sale,  or  who  shall  in  pursuance  of  any  such 
sale  deliver  any  stock  or  evidence  of  the  sale  of  any  stock  or  bill  or 
memorandum  thereof,  as  herein  required,  without  having  the  proper 
stamps  affixed  thereto  with  intent  to  evade  the  foregoing  provisions 
shall  be  deemed  guilty  of  a  misdemeanor,  and  upon  conviction 
thereof  shall  pay  a  fine  of  not  exceeding  $1,000,  or  be  imprisoned  not 
more  than  six  months,  or  both,  at  the  discretion  of  the  court 

5.  Produce,  sales  of,  on  exchange:  Upon  each  sale,  agreement 
of  sale,  or  agreement  to  sell,  including  so-called  transferred  or  scratch 
sales,  any  products  or  merchandise  at  any  exchange,  or  board  of 
trade,  or  other  similar  place,  for  future  delivery,  for  each  $100  in 
value  of  the  merchandise  covered  by  said  sale  or  agreement  of  sale 
or  agreement  to  sell,  2  cents,  and  for  each  additional  $100 
or  fractional  part  thereof  in  excess  of  $100,  2  cents:  Provided , 
That  on  every  sale  or  agreement  of  sale  or  agreement  to 
sell  as  aforesaid  there  shall  be  made  and  delivered  by  the  seller  to 
the  buyer  a  bill,  memorandum,  agreement,  or  other  evidence  of 
such  sale,  agreement  of  sale,  or  agreement  to  sell,  to  which  there 
shall  be  affixed  a  lawful  stamp  or  stamps  in  value  equal  to  the  amount 
of  the  tax  on  such  sale:  Provided  further,  That  sellers  of  commodities 
described  herein,  having  paid  the  tax  provided  by  this  subdivision, 
may  transfer  such  contracts  to  a  clearing  house  corporation  or 
association,  and  such  transfer  shall  not  be  deemed  to  be  a  sale,  or 
agreement  of  sale,  or  an  agreement  to  sell  within  the  provisions  of 
this  Act,  provided  that  such  transfer  shall  not  vest  any  beneficial 
interest  in  such  clearing  house  association  but  shall  be  made  for  the 
sole  purpose  of  enabling  such  clearing  house  association  to  adjust 
and  balance  the  accounts  of  the  members  of  said  clearing  house 
association  on  their  several  contracts.  And  every  such  bill,  mem¬ 
orandum,  or  other  evidence  of  sale  or  agreement  to  sell  shall  show 
the  date  thereof,  the  name  of  the  seller,  the  amount  of  the  sale,  and 
the  matter  or  thing  to  which  it  refers;  and  any  person  or  persons 
liable  to  pay  the  tax  as  herein  provided,  or  anyone  who  acts  in  the 
matter  as  agent  or  broker  for  such  person  or  persons,  who  shall  make 
any  such  sale  or  agreement  of  sale,  or  agreement  to  sell,  or  who 
shall,  in  pursuance  of  any  such  sale,  agreement  of  sale,  or  agreement 
to  sell,  deliver  any  such  products  or  merchandise  without  a  bill, 
memorandum,  or  other  evidence  thereof  as  herein  required,  or  who 
shall  deliver  such  bill,  memorandum,  or  other  evidence  of  sale,  or 
agreement  to  sell,  without  having  the  proper  stamps  affixed  thereto, 
with  intent  to  evade  the  foregoing  provisions,  shall  be  deemed  guilty 
of  a  misdemeanor,  and  upon  conviction  thereof  shall  pay  a  fine  of 

38 


not  exceeding  $1,000,  or  be  imprisoned  not  more  than  six  months,  or 
both,  at  the  discretion  of  the  court. 

That  no  bill,  memorandum,  agreement,  or  other  evidence  of 
such  sale,  or  agreement  of  sale,  or  agreement  to  sell,  in  case  of  cash 
sales  of  products  or  merchandise  for  immediate  or  prompt  delivery 
which  in  good  faith  are  actually  intended  to  be  delivered  shall  be 
subject  to  this  tax. 

6.  Drafts  or  checks  payable  otherwise  than  at  sight  or  on  demand? 
promissory  notes,  except  bank  notes  issued  for  circulation,  and  for 
each  renewal  of  the  same,  for  a  sum  not  exceeding  $100,  2  cents; 
and  for  each  additional  $100  or  fractional  part  thereof,  2  cents. 

7.  Conveyance:  Deed,  instrument,  or  writing,  whereby  any 
lands,  tenements,  or  other  realty  sold  shall  be  granted,  assigned, 
transferred,  or  otherwise  conveyed  to,  or  vested  in,  the  purchaser  or 
purchasers,  or  any  other  person  or  persons,  by  his,  her,  or  their 
direction,  when  the  consideration  or  value  of  the  interest  or  property 
conveyed,  exclusive  of  the  value  of  any  lien  or  encumbrance  remaining 
thereon  at  the  time  of  sale,  exceeds  $100  and  does  not  exceed  $500, 
50  cents;  and  for  each  additional  $500  or  fractional  part  thereof 
50  cents:  Provided ,  That  nothing  contained  in  this  paragraph  shall 
be  so  construed  as  to  impose  a  tax  upon  any  instrument  or  writing 
given  to  secure  a  debt. 

8.  Entry  of  any  goods,  wares,  or  merchandise  at  any  custom¬ 
house,  either  for  consumption  or  warehousing,  not  exceeding  $100 
in  value,  25  cents;  exceeding  $100  and  not  exceeding  $500  in  value, 
50  cents;  exceeding  $500  in  value,  $1. 

9.  Entry  for  the  withdrawal  of  any  goods  or  merchandise  from 
customs  bonded  warehouse,  50  cents. 

10.  Passage  ticket,  one  way  or  round  trip,  for  each  passenger, 
sold  or  issued  in  the  United  States  for  passage  by  any  vessel  to  a 
port  or  place  not  in  the  United  States,  Canada,  or  Mexico,  if  costing 
not  exceeding  $30,  $1;  costing  more  than  $30  and  not  exceeding  $60, 
$3;  costing  more  than  $60,  $5 :  Provided ,  That  such  passage  tickets, 
costing  $10  or  less,  shall  be  exempt  from  taxation. 

11.  Proxy  for  voting  at  any  election  for  officers,  or  meeting  for 
the  transaction  of  business,  of  any  incorporated  company  or  asso¬ 
ciation,  except  religious,  educational,  charitable,  fraternal,  or  literary 
societies,  or  public  cemeteries,  10  cents. 

12.  Power  of  attorney  granting  authority  to  do  or  perform  some 
act  for  or  in  behalf  of  the  grantor,  which  authority  is  not  otherwise 
vested  in  the  grantee,  25  cents:  Provided ,  That  no  stamps  shall  be 
required  upon  any  papers  necessary  to  be  used  for  the  collection  of 
claims  from  the  United  States  or  from  any  State  for  pensions,  back 
pay,  bounty,  or  for  property  lost  in  the  military  or  naval  service  or 
upon  powers  of  attorney  required  in  bankruptcy  cases. 

39 


13.  Playing  cards:  Upon  every  pack  of  playing  cards  containing 
not  more  than  fifty-four  cards,  manufactured  or  imported,  and  sold, 
or  removed  for  consumption  or  sale,  after  the  passage  of  this  Act, 
a  tax  of  5  cents  per  pack  in  addition  to  the  tax  imposed  under  ex¬ 
isting  law. 

14.  Parcel-post  packages:  Upon  every  parcel  or  package 
transported  from  one  point  in  the  United  States  to  another  by 
parcel  post  on  which  the  postage  amounts  to  25  cents  or  more,  a 
tax  of  1  cent  for  each  25  cents  or  fractional  part  thereof  charged  for 
such  transportation,  to  be  paid  by  the  consignor. 

No  such  parcel  or  package  shall  be  transported  until  a  stamp  or 
stamps  representing  the  tax  due  shall  have  been  affixed  thereto. 

TITLE  IX, — War  Estate  Tax. 

Sec.  900.  That  in  addition  to  the  tax  imposed  by  section  two 
hundred  and  one  of  the  Act  entitled  “An  Act  to  increase  the  revenue, 
and  for  other  purposes,”  approved  September  eighth,  nineteen 
hundred  and  sixteen,  as  amended — 

(a)  A  tax  equal  to  the  following  percentages  of  its  value  is  hereby 
imposed  upon  the  transfer  of  each  net  estate  of  every  decedent  dying 
after  the  passage  of  this  Act,  the  transfer  of  which  is  taxable  under 
such  section  (the  value  of  such  net  estate  to  be  determined  as  pro¬ 
vided  in  Title  II  of  such  Act  of  September  eighth,  nineteen  hundred 
and  sixteen): 

One-half  of  one  per  centum  of  the  amount  of  such  net  estate 
not  in  excess  of  $50,000; 

One  per  centum  of  the  amount  by  which  such  net  estate  exceeds 
$50,000  and  does  not  exceed  $150,000; 

One  and  one-half  per  centum  of  the  amount  by  which  such  net 
estate  exceeds  $150,000  and  does  not  exceed  $250,000; 

Two  per  centum  of  the  amount  by  which  such  net  estate  exceeds 
$250,000  and  does  not  exceed  $450,000; 

Two  and  one-half  per  centum  of  the  amount  by  which  such  net 
estate  exceeds  $450,000  and  does  not  exceed  $1,000,000; 

Three  per  centum  of  the  amount  by  which  such  net  estate  exceeds 
$1,000,000  and  does  not  exceed  $2,000,000; 

Three  and  one-half  per  centum  of  the  amount  by  which  such  net 
estate  exceeds  $2,000,000  and  does  exceed  $3,000,000; 

Four  per  centum  of  the  amount  by  which  such  net  estate  exceeds 
$3,000,000  and  does  not  exceed  $4,000,000; 

Four  and  one-half  per  centum  of  the  amount  by  which  such  net 
estate  exceeds  $4,000,000  and  does  not  exceed  $5,000,000; 

40 


Five  per  centum  of  the  amount  by  which  such  net  estate  exceeds 
$5,000,000  and  does  not  exceed  $8,000,000; 

Seven  per  centum  of  the  amount  by  which  such  net  estate  exceeds 
$8,000,000  and  does  not  exceed  $10,000,000;  and 

Ten  per  centum  of  the  amount  by  which  such  net  estate  exceeds 

$10,000,000. 

Sec.  901.  That  the  tax  imposed  by  this  title  shall  not  apply 
to  the  transfer  of  the  net  estate  of  any  decedent  dying  while  serving 
in  the  military  or  naval  forces  of  the  United  States,  during  the  con¬ 
tinuance  of  the  war  in  which  the  United  States  is  now  engaged,  or 
if  death  results  from  injuries  received  or  disease  contracted  in  such 
service,  within  in  one  year  after  the  termination  of  such  war.  For 
the  purposes  of  this  section  the  termination  of  the  war  shall  be 
evidenced  by  the  proclamation  of  the  President. 

TITLE  X. — Administrative  Provisions. 

Sec.  1000.  That  there  shall  be  levied,  collected,  and  paid  in  the 
United  States,  upon  articles  coming  into  the  United  States  from  the 
West  Indian  Islands  acquired  from  Denmark,  a  tax  equal  to  the 
internal-revenue  tax  imposed  in  the  United  States  upon  like  articles 
of  domestic  manufacture;  such  articles  shipped  from  said  islands  to 
the  United  States  shall  be  exempt  from  the  payment  of  any  tax 
imposed  by  the  internal-revenue  laws  of  said  islands:  Provided , 
That  there  shall  be  levied,  collected,  and  paid  in  said  islands,  upon 
articles  imported  from  the  United  States,  a  tax  equal  to  the  internal- 
revenue  tax  imposed  in  said  islands  upon  like  articles  there  manu¬ 
factured;  and  such  articles  going  into  said  islands  from  the  United 
States  shall  be  exempt  from  payment  of  any  tax  imposed  by  the 
internal-revenue  laws  of  the  United  States. 

Sec.  1001.  That  all  administrative,  special,  or  stamp  provisions 
of  law,  including  the  law  relating  to  the  assessment  of  taxes,  so  far  as 
applicable,  are  hereby  extended  to  and  made  a  part  of  this  Act,  and 
every  person,  corporation,  partnership,  or  association  liable  to  any 
tax  imposed  by  this  Act,  or  for  the  collection  thereof,  shall  keep  such 
records  and  render,  under  oath,  such  statements  and  returns,  and 
shall  comply  with  such  regulations  as  the  Commissioner  of  Internal 
Revenue,  with  the  approval  of  the  Secretary  of  the  Treasury,  may 
from  time  to  time  prescribe. 

Sec.  1002.  That  where  additional  taxes  are  imposed  by  this  Act 
upon  articles  or  commodities,  upon  which  the  tax  imposed  by  existing 
law  has  been  paid,  the  person,  corporation,  partnership,  or  asso¬ 
ciation  required  by  this  Act  to  pay  the  tax  shall,  within  thirty  days 
after  its  passage,  make  return  under  oath  in  such  form  and  under 
such  regulations  as  the  Commissioner  of  Internal  Revenue  with  the 
approval  of  the  Secretary  of  the  Treasury  shall  prescribe.  Payment 
of  the  tax  shown  to  be  due  may  be  extended  to  a  date  not  exceeding 
seven  months  from  the  passage  of  this  Act,  upon  the  filing  of  a 

41 


bond  for  payment  in  such  form  and  amount  and  with  such  sureties 
as  the  Commissioner  of  Internal  Revenue,  with  the  approval  of  the 
Secretary  of  the  Treasury,  may  prescribe. 

Sec.  1003.  That  in  all  cases  where  the  method  of  collecting  the 
tax  imposed  by  this  Act  is  not  specifically  provided,  the  tax  shall 
be  collected  in  such  manner  as  the  Commissioner  of  Internal  Revenue 
with  the  approval  of  the  Secretary  of  the  Treasury  may  prescribe. 
All  administrative  and  penalty  provisions  of  Title  VIII  of  this  Act, 
in  so  far  as  applicable,  shall  apply  to  the  collection  of  any  tax  which 
the  Commissioner  of  Internal  Revenue  determines  or  prescribes 
shall  be  paid  by  stamp. 

Sec.  1004.  That  whoever  fails  to  make  any  return  required  by 
this  Act  or  the  regulations  made  under  authority  thereof  within  the 
time  prescribed  or  who  makes  any  false  or  fraudulent  return,  and 
whoever  evades  or  attempts  to  evade  any  tax  imposed  by  this  Act 
or  fails  to  collect  or  truly  to  account  for  and  pay  over  any  such  tax, 
shall  be  subject  to  a  penalty  of  not  more  than  $1,000,  or  to  imprison¬ 
ment  for  not  more  than  one  year,  or  both,  at  the  discretion  of  the 
court,  and  in  addition  thereto  a  penalty  of  double  the  tax  evaded,  or 
not  collected,  or  accounted  for  and  paid  over,  to  be  assessed  and 
collected  in  the  same  manner  as  taxes  are  assessed  and  collected,  in 
any  case  in  which  the  punishment  is  not  otherwise  specifically 
provided. 

Sec.  1005.  That  the  Commissioner  of  Internal  Revenue,  with  the 
approval  of  the  Secretary  of  the  Treasury,  is  hereby  authorized  to 
make  all  needful  rules  and  regulations  for  the  enforcement  of  the 
provisions  of  this  Act. 

Sec.  1006.  That  where  the  rate  of  tax  imposed  by  this  Act,  pay¬ 
able  by  stamps,  is  an  increase  over  previously  existing  rates,  stamps 
on  hand  in  the  collectors’  offices  and  in  the  Bureau  of  Internal 
Revenue  may  continue  to  be  used  until  the  supply  on  hand  is  exhaus¬ 
ted,  but  shall  be  sold  and  accounted  for  at  the  rates  provided  by  this 
Act,  and  assessment  shall  be  made  against  manufacturers  and  other 
taxpayers  having  such  stamps  on  hand  on  the  day  this  Act  takes 
effect  for  the  difference  between  the  amount  paid  for  such  stamps 
and  the  tax  due  at  the  rates  provided  by  this  Act. 

Sec.  1007.  That  ( a )  if  any  person,  corporation,  partnership,  or 
association  has  prior  to  May  ninth,  nineteen  hundred  and  seventeen, 
made  a  bona  fide  contract  with  a  dealer  for  the  sale,  after  the  tax 
takes  effect,  of  any  article  (or  in  the  case  of  moving  picture  films, 
such  a  contract  with  a  dealer,  exchange,  or  exhibitor,  for  the  sale  or 
lease  thereof)  upon  which  a  tax  is  imposed  under  Title  III,  IV,  or  VI, 
or  under  subdivision  thirteen  of  Schedule  A  of  Title  VIII,  or  under 
this  section,  and  (b)  if  such  contract  does  not  permit  the  adding  of 
the  whole  of  such  tax  to  the  amount  to  be  paid  under  such  contract, 
then  the  vendee  or  lessee  shall,  in  lieu  of  the  vendor,  or  lessor,  pay 
so  much  of  such  tax  as  is  not  so  permitted  to  be  added  to  the  con¬ 
tract  price. 


42 


The  taxes  payable  by  the  vendee  or  lessee  under  this  section 
shall  be  paid  to  the  vendor  or  lessor  at  the  time  the  sale  or  lease  is 
consummated,  and  collected,  returned,  and  paid  to  the  United 
States  by  such  vendor  or  lessor  in  the  same  manner  as  provided  in 
section  five  hundred  and  three. 

The  term  “dealer”  as  used  in  this  section  includes  a  vendee  who 
purchases  any  article  with  intent  to  use  it  in  the  manufacture  or 
production  of  another  article  intended  for  sale. 

Sec.  1008.  That  in  the  payment  of  any  tax  under  this  Act  not 
payable  by  stamp  a  fractional  part  of  a  cent  shall  be  disregarded 
unless  it  amounts  to  one-half  cent  or  more,  in  which  case  it  shall 
be  increased  to  one  cent. 

Sec.  1009.  That  the  Secretary  of  the  Treasury,  under  rules  and 
regulations  prescribed  by  him,  shall  permit  taxpayers  liable  to  income 
and  excess  profits  taxes  to  make  payments  in  advance  in  installments 
or  in  whole  of  an  amount  not  in  excess  of  the  estimated  taxes  which 
will  be  due  from  them,  and  upon  determination  of  the  taxes  actually 
due  any  amount  paid  in  excess  shall  be  refunded  as  taxes  erroneously 
collected:  Provided ,  That  when  payment  is  made  in  installments  at 
least  one-fourth  of  such  estimated  tax  shall  be  paid  before  the  expira¬ 
tion  of  thirty  days  after  the  close  of  the  taxable  year,  at  least  an 
additional  one-fourth  within  two  months  after  the  close  of  the  taxable 
year,  at  least  an  additional  one-fourth  within  four  months  after  the 
close  of  the  taxable  year,  and  the  remainder  of  the  tax  due  on  or 
before  the  time  now  fixed  by  law  for  such  payment:  Provided 
further ,  That  the  Secretary  of  the  Treasury,  under  rules  and  regu¬ 
lations  prescribed  by  him,  may  allow  credit  against  such  taxes  so 
paid  in  advance  of  an  amount  not  exceeding  three  per  centum  per 
annum  calculated  upon  the  amount  so  paid  from  the  date  of  such 
payment  to  the  date  now  fixed  by  law  for  such  payment;  but  no  such 
credit  shall  be  allowed  on  payments  in  excess  of  taxes  determined 
to  be  due,  nor  on  payments  made  after  the  expiration  of  four  and 
one-half  months  after  the  close  of  the  taxable  year.  All  penalties 
provided  by  existing  law  for  failure  to  pay  tax  when  due  are  hereby 
made  applicable  to  any  failure  to  pay  the  tax  at  the  time  or  times 
required  in  this  section. 

Sec.  1010.  That,  under  rules  and  regulations  prescribed  by  the 
Secretary  of  the  Treasury,  Collectors  of  Internal  Revenue  may 
receive,  at  par  and  accrued  interest,  certificates  of  indebtedness  issued 
under  section  six  of  the  Act  entitled  “An  Act  to  authorize  an  issue  of 
bonds  to  meet  expenditures  for  the  national  security  and  defense,  and, 
for  the  purpose  of  assisting  in  the  prosecution  of  the  war,  to  extend 
credit  to  foreign  governments,  and  for  other  purposes,”  approved 
April  twenty-fourth,  nineteen  hundred  and  seventeen,  and  any 
subsequent  Act  or  Acts,  and  uncertified  checks  in  payment  of  income 
and  excess  profits  taxes,  during  such  time  and  under  such  regulations 
as  the  Commissioner  of  Internal  Revenue,  with  the  approval  of  the 
Secretary  of  the  Treasury,  shall  prescribe;  but  if  a  check  so  received 

43 


is  not  paid  by  the  bank  on  which  it  is  drawn  the  person  by  whom  such 
check  has  been  tendered  shall  remain  liable  for  the  payment  of  the 
tax  and  for  all  legal  penalties  and  additions  the  same  as  if  such 
check  had  not  been  tendered. 

TITLE  XI. — Postal  Rates. 

Sec.  1100.  That  the  rate  of  postage  on  all  mail  matter  of  the 
first  class,  except  postal  cards,  shall,  thirty  days  after  the  passage 
of  this  Act  be,  in  addition  to  the  existing  rate,  1  cent  for  each  ounce 
or  fraction  thereof:  Provided ,  That  the  rate  of  postage  on  drop 
letters  of  the  first  class  shall  be  2  cents  an  ounce  or  fraction  thereof. 
Postal  cards,  and  private  mailing  or  post  cards  when  complying  with 
the  requirements  of  existing  law,  shall  be  transmitted  through  the 
mails  at  1  cent  each  in  addition  to  the  existing  rate. 

That  letters  written  and  mailed  by  soldiers,  sailors,  and  marines 
assigned  to  duty  in  a  foreign  country  engaged  in  the  present  war 
may  be  mailed  free  of  postage,  subject  to  such  rules  and  regulations 
as  may  be  prescribed  by  the  Postmaster  General. 

Sec.  1101.  That  on  and  after  July  first,  nineteen  hundred  and 
eighteen,  the  rates  of  postage  on  publications  entered  as  second-class 
matter  (including  sample  copies  to  the  extent  of  ten  per  centum  of 
the  weight  of  copies  mailed  to  subscribers  during  the  calendar  year) 
when  sent  by  the  publisher  thereof  from  the  post  office  of  publication 
or  other  post  office,  or  when  sent  by  a  news  agent  to  actual  subscribers 
thereto,  or  to  other  news  agents  for  the  purpose  of  sale: 

{a)  In  the  case  of  the  portion  of  such  publication  devoted  to  mat¬ 
ter  other  than  advertisements,  shall  be  as  follows:  (1)  on  and  after 
July  first,  nineteen  hundred  and  eighteen,  and  until  July  first, 
nineteen  hundred  and  nineteen,  134  cents  per  pound  or  fraction 
thereof;  (2)  on  and  after  July  first,  nineteen  hundred  and  nineteen, 
1J4  cents  per  pound  or  fraction  thereof; 

(b)  In  the  case  of  the  portion  of  such  publication  devoted  to 
advertisements  the  rates  per  pound  or  fraction  thereof  for  delivery 
within  the  several  zones  applicable  to  fourth-class  matter  shall  be 
as  follows  (but  where  the  space  devoted  to  advertisements  does  not 
exceed  five  per  centum  of  the  total  space,  the  rate  of  postage  shall  be 
the  same  as  if  the  whole  of  such  publication  was  devoted  to  matter 
other  than  advertisements):  (1)  on  and  after  July  first,  nineteen 
hundred  and  eighteen,  and  until  July  first,  ninteen  hundred 
and  nineteen,  for  the  first  and  second  zones,  1J4  cents;  for  the 
third  zone,  1J4  cents;  for  the  fourth  zone,  2  cents;  for  the  fifth 
zone,  234  cents;  for  the  sixth  zone,  2 34  cents;  for  the  seventh  zone, 
3  cents;  for  the  eighth  zone,  3} 4  cents;  (2)  on  and  after  July  first, 
nineteen  hundred  and  nineteen,  and  until  July  first, nineteen  hundred 
and  twenty,  for  the  first  and  second  zones,  1J4  cents;  for  the  third 
zone,  2  cents;  for  the  fourth  zone,  3  cents;  for  the  fifth  zone  334  cents; 
for  the  sixth  zone,  4  cents;  for  the  seventh  zone,  5  cents;  for  the 

44 


eighth  zone,  5j^>  cents;  (3)  on  and  after  July  first,  nineteen  hundred 
and  twenty  and  until  July  first,  nineteen  hundred  and  twenty-one, 
for  the  first  and  second  zones,  1%  cents;  for  the  third  zone,  cents; 
for  the  fourth  zone,  4  cents;  for  the  fifth  zone,  4J4  cents;  for  the  sixth 
zone,  53^2  cents;  for  the  seventh  zone,  7  cents;  for  the  eighth  zone, 
7%  cents;  (4)  on  and  after  July  first,  nineteen  hundred  and  twenty- 
one,  for  the  first  and  second  zones,  2  cents;  for  the  third  zone,  3  cents; 
for  the  fourth  zone,  5  cents;  for  the  fifth  zone,  6  cents;  for  the  sixth 
zone,  7  cents;  for  the  seventh  zone,  9  cents;  for  the  eighth  zone,  10 
cents; 

(c)  With  the  first  mailing  of  each  issue  of  each  such  publication, 
the  publisher  shall  file  with  the  postmaster  a  copy  of  such  issue, 
together  with  a  statement  containing  such  information  as  the  Post¬ 
master  General  may  prescribe  for  determining  the  postage  chargeable 
thereon. 

Sec.  1102.  That  the  rate  of  postage  on  daily  newspapers,  when 
the  same  are  deposited  in  a  letter  carrier  office  for  delivery  by  its 
carriers,  shall  be  the  same  as  now  provided  by  law;  and  nothing 
in  this  title  shall  affect  existing  law  as  to  free  circulation  and  existing 
rates  on  second-class  mail  matter  wdthin  the  county  of  publication: 
Provided ,  That  the  Postmaster  General  may  hereafter  require  pub¬ 
lishers  to  separate  or  make  up  to  zones  in  such  a  manner  as  he  may 
direct  all  mail  matter  of  the  second  class  when  offered  for  mailing. 

Sec.  1103.  That  in  the  case  of  newspapers  and  periodicals 
entitled  to  be  entered  as  second-class  matter  and  maintained  by  and 
in  the  interest  of  religious,  educational,  scientific,  philanthropic,  agri¬ 
cultural,  labor,  or  fraternal  organizations  or  associations,  not  organ¬ 
ized  for  profit  and  none  of  the  net  income  of  which  inures  to  the 
benefit  of  any  private  stockholder  or  individual,  the  second-class 
postage  rates  shall  be,  irrespective  of  the  zone  in  which  delivered 
(except  when  the  same  are  deposited  in  a  letter-carrier  office  for 
delivery  by  its  carriers,  in  which  case  the  rates  shall  be  the  same  as 
now  provided  by  law),  1 cents  a  pound  or  fraction  thereof  on  and 
after  July  first,  nineteen  hundred  and  eighteen,  and  until  July  first, 
nineteen  hundred  and  nineteen,  and  on  and  after  July  first,  nineteen 
hundred  and  nineteen,  1J4  cents  a  pound  or  fraction  thereof.  The 
publishers  of  such  newspapers  or  periodicals  before  being  entitled 
to  the  foregoing  rates  shall  furnish  to  the  Postmaster  General,  at 
such  times  and  under  such  conditions  as  he  may  prescribe,  satisfactory 
evidence  that  none  of  the  net  income  of  such  organization  inures 
to  the  benefit  of  any  private  stocckholder  or  individual. 

Sec.  1104.  That  where  the  total  weight  of  any  one  edition  or 
issue  of  any  publication  mailed  to  any  one  zone  does  not  exceed  one 
pound,  the  rate  of  postage  shall  be  1  cent. 

Sec.  1105.  The  zone  rates  provided  by  this  title  shall  relate  to 
the  entire  bulk  mailed  to  any  one  zone  and  not  to  individually 
addressed  packages. 


45 


Sec.  1106.  That  where  a  newspaper  or  periodical  is  mailed  by 
other  than  the  publisher  or  his  agent  or  a  news  agent  or  dealer,  the 
rate  shall  be  the  same  as  now  provided  by  law. 

Sec.  1107.  That  the  Postmaster-General,  on  or  before  the 
tenth  day  of  each  month,  shall  pay  into  the  general  fund  of  the 
Treasury  an  amount  equal  to  the  difference  between  the  estimated 
amount  received  during  the  preceding  month  for  the  transportation 
of  first  class  matter  through  the  mails  and  the  estimated  amount 
which  would  have  been  received  under  the  provisions  of  the  law  in 
force  at  the  time  of  the  passage  of  this  Act. 

Sec.  1108.  That  the  salaries  of  postmasters  at  offices  of  the  first, 
second,  and  third  classes  shall  not  be  increased  after  July  first,  nine¬ 
teen  hundred  and  seventeen,  during  the  existence  of  the  present 
war.  The  compensation  of  postmasters  at  offices  of  the  fourth 
class  shall  continue  to  be  computed  on  the  basis  of  the  present  rates 
of  postage. 

Sec.  1109.  That  where  postmasters  at  offices  of  the  third  class 
have  been  since  May  first,  nineteen  hundred  and  seventeen,  or 
hereafter  are  granted  leave  without  pay  for  military  purposes,  the 
Postmaster  General  may  allow,  in  addition  to  the  maximum  amounts 
which  may  now  be  allowed  such  offices  for  clerk  hire,  in  accordance 
with  law  an  amount  not  to  exceed  fifty  per  centum  of  the  salary 
of  the  postmaster. 

Sec.  1110.  That  section  five  of  the  Act  approved  March  third, 
nineteen  hundred  and  seventeen,  entitled  “An  Act  making  appro¬ 
priations  for  the  Post  Office  Department  for  the  year  ending  June 
thirtieth,  nineteen  hundred  and  eighteen,”  shall  not  be  construed 
to  apply  to  ethyl  alcohol  for  governmental,  scientific,  medicinal, 
mechanical,  manufacturing,  and  industrial  purposes,  and  the  Post¬ 
master  General  shall  prescribe  suitable  rules  and  regulations  to  carry 
into  effect  this  section  in  connection  with  the  Act  of  which  it  is 
amendatory,  nor  shall  said  section  be  held  to  prohibit  the  use  of  the 
mails  by  regularly  ordained  ministers  of  religion;  or  by  officers  of 
regularly  established  churches,  for  ordering  wines  for  sacramental 
uses,  or  by  manufacturers  and  dealers  for  quoting  and  billing  such 
wines  for  such  purposes  only. 

TITLE  XII. — Income  Tax  Amendments. 

Sec.  1200.  That  subdivision  (a)  of  section  two  of  such  Act  of 
September  eighth,  nineteen  hundred  and  sixteen,  is  hereby  amended 
to  read  as  follows: 

“(tf)  That,  subject  only  to  such  exemptions  and  deductions  as 
are  hereinafter  allowed,  the  net  income  of  a  taxable  person  shall 
include  gains,  profits,  and  income,  derived  from  salaries,  wages,  or 
compensation  for  personal  service  of  whatever  kind  and  in  whatever 
form  paid,  or  from  professions,  vocations,  businesses,  trade,  com- 

46 


merce,  or  sales,  or  dealings  in  property,  whether  real  or  personal, 
growing  out  of  the  ownership  or  use  of  or  interest  in  real  or  personal 
property,  also  from  interest,  rent,  dividends,  securities,  or  the  trans¬ 
action  of  any  business  carried  on  for  gain  or  profit,  or  gains  or  profits 
and  income  derived  from  any  source  whatever. 

Section  four  of  such  Act  of  September  eighth,  nineteen  hundred 
and  sixteen,  is  hereby  amended  to  read  as  follows: 

“Sec.  4.  The  following  income  shall  be  exempt  from  the 
provisions  of  this  title: 

“The  proceeds  of  life  insurance  policies  paid  to  individual 
beneficiaries  upon  the  death  of  the  insured;  the  amount  received  by 
the  insured,  as  a  return  of  premium  or  premiums  paid  by  him  under 
life  insurance,  endowment,  or  annuity  contracts,  either  during  the 
term  or  at  the  maturity  of  the  term  mentioned  in  the  contract  or 
upon  surrender  of  the  contract;  the  value  of  property  acquired  by 
gift,  bequest,  devise,  or  descent  (but  the  income  from  such  property 
shall  be  included  as  income);  interest  upon  the  obligations  of  a 
State  or  any  political  subdivision  thereof  or  upon  the  obligations 
of  the  United  States  (but,  in  the  case  of  obligations  of  the  United 
States  issued  after  September  first,  nineteen  hundred  and  seventeen, 
only  if  and  to  the  extent  provided  in  the  Act  authorizing  the  issue 
thereof)  or  its  possessions  or  securities  issued  under  the  provisions 
of  the  Federal  Farm  Loan  Act  of  July  seventeenth,  nineteen  hundred 
and  sixteen;  the  compensation  of  the  present  President  of  the 
United  States  during  the  term  for  which  he  has  been  elected  and 
the  judges  of  the  supreme  and  inferior  courts  of  the  United  States 
now  in  office,  and  the  compensation  of  all  officers  and  employees  of 
a  State,  or  any  political  subdivision  thereof,  except  when  such 
compensation  is  paid  by  the  United  States  Government.” 

Sec.  1201.  (1)  That  paragraphs  second  and  third  of  subdivision 

(a)  of  section  five  of  such  Act  of  September  eighth,  nineteen  hundred 
and  sixteen,  are  hereby  amended  to  read  as  follows: 

“Second.  All  interest  paid  within  the  year  on  his  indebtedness 
except  on  indebtedness  incurred  for  the  purchase  of  obligations  or 
securities  the  interest  upon  which  is  exempt  from  taxation  as  in¬ 
come  under  this  title; 

“Third.  Taxes  paid  within  the  year  imposed  by  the  authority 
of  the  United  States  (except  income  and  excess  profits  taxes)  or  of  its 
Territories,  or  possessions,  or  any  foreign  country,  or  by  the  authority 
of  any  State,  county,  school  district,  or  municipality,  or  other 
taxing  subdivision  of  any  State,  not  including  those  assessed  against 
local  benefits;” 

(2)  That  section  five  of  such  Act  of  September  eighth, 
nineteen  hundred  and  sixteen,  is  hereby  amended  by  adding  at  the 
end  of  subdivision  (a)  a  further  paragraph  numbered  nine,  to  read 
as  follows: 


47 


“Ninth.  Contributions  or  gifts  actually  made  within  the  year 
to  corporations  or  associations  organized  and  operated  exclusively 
for  religious,  charitable,  scientific,  or  educational  purposes,  or  to 
societies  for  the  prevention  of  cruelty  to  children  or  animals,  no 
part  of  the  net  income  of  which  inures  to  the  benefit  of  any  private 
stockholder  or  individual,  to  an  amount  not  in  excess  of  fifteen  per 
centum  of  the  taxpayer’s  taxable  net  income  as  computed  without 
the  benefit  of  this  paragraph.  Such  contributions  or  gifts  shall  be 
allowable  as  deductions  only  if  verified  under  rules  and  regulations 
prescribed  by  the  Commissioner  of  Internal  Revenue,  with  the 
approval  of  the  Secretary  of  the  Treasury.” 

Sec.  1202.  That  (1)  paragraphs  second  and  third  of  subdivision 
{a)  of  section  six  of  such  Act  of  September  eighth,  nineteen  hundred 
and  sixteen,  are  hereby  amended  to  read  as  follows: 

“Second.  The  proportion  of  all  interest  paid  within  the  year 
by  such  person  on  his  indebtedness  (except  on  indebtedness  incurred 
for  the  purchase  of  obligations  or  securities  the  interest  upon  which 
is  exempt  from  taxation  as  income  under  this  title)  which  the  gross 
amount  of  his  income  for  the  year  derived  from  sources  within  the 
United  States  bears  to  the  gross  amount  of  his  income  for  the  year 
derived  from  all  sources  within  and  without  the  United  States, 
but  this  deduction  shall  be  allowed  only  if  such  person  includes  in  the 
return  required  by  section  eight  all  the  information  necessary  for 
its  calculation; 

“Third.  Taxes  paid  within  the  year  imposed  by  the  authority 
of  the  United  States  (except  income  and  excess  profits  taxes),  or  of  its 
Territories,  or  possessions,  or  by  the  authority  of  any  State,  county, 
school  district,  or  municipality,  or  other  taxing  subdivision  of  any 
State,  paid  within  the  United  States,  not  including  those  assessed 
against  local  benefits;” 

(2)  Section  six  of  such  Act  of  September  eighth,  nineteen  hundred 
and  sixteen,  is  also  further  amended  by  adding  a  new  subdivision 
to  read  as  follows: 

“(c)  A  nonresident  alien  individual  shall  receive  the  benefit 
of  the  deductions  and  credits  provided  for  in  this  section  only  by 
filing  or  causing  to  be  filed  with  the  collector  of  internal  revenue  a 
true  and  accurate  return  of  his  total  income,  received  from  all 
sources,  corporate  or  otherwise,  in  the  United  States,  in  the  manner 
prescribed  by  this  title;  and  in  case  of  his  failure  to  file  such  return 
the  collector  shall  collect  the  tax  on  such  income,  and  all  property 
belonging  to  such  nonresident  alien  individual  shall  be  liable  to 
distraint  for  the  tax.” 

Sec.  1203.  (1)  That  section  seven  of  such  Act  of  September  eighth, 
nineteen  hundred  and  sixteen,  is  hereby  amended  to  read  as  follows: 

“Sec.  7.  That  for  the  purpose  of  the  normal  tax  only,  there  shall 
be  allowed  as  an  exemption  in  the  nature  of  a  deduction  from  the 

48 


amount  of  the  net  income  of  each  citizen  or  resident  of  the  United 
States,  ascertained  as  provided  herein,  the  sum  of  $3,000,  plus  $1,000 
additional  if  the  person  making  the  return  be  a  head  of  a  family  ora 
married  man  with  a  wife  living  with  him,  or  plus  the  sum  of  $1,000 
additional  if  the  person  making  the  return  be  a  married  woman  with 
a  husband  living  with  her;  but  in  no  event  shall  this  additional 
exemption  of  $1,000  be  deducted  by  both  a  husband  and  a  wife: 
Provided ,  That  only  one  deduction  of  $4,000  shall  be  made  from  the 
aggregate  income  of  both  husband  and  wife  when  living  together: 
Provided  further,  That  if  the  person  making  the  return  is  the  head  of 
a  family  there  shall  be  an  additional  exemption  of  $200  for  each 
child  dependent  upon  such  person,  if  under  eighteen  years  of  age,  or 
if  incapable  of  self-support  because  mentally  or  physically  defective, 
but  this  provision  shall  operate  only  in  the  case  of  one  parent  in  the 
same  family:  Provided  further,  That  guardians  or  trustees  shall  be 
allowed  to  make  this  personal  exemption  as  to  income  derived  from 
the  property  of  which  such  guardian  or  trustee  has  charge  in  favor 
of  each  ward  or  cestui  que  trust:  Provided  further,  That  in  no  event 
shall  a  ward  or  cestui  que  trust  be  allowed  a  greater  personal  exemp¬ 
tion  than  as  provided  in  this  section  from  the  amount  of  net  income 
received  from  all  sources.  There  shall  also  be  allowed  an  exemption 
from  the  amount  of  the  net  income  of  estates  of  deceased  citizens  or 
residents  of  the  United  States  during  the  period  of  administration  or 
settlement,  and  of  trust  or  other  estates  of  citizens  or  residents  of  the 
United  States  the  income  of  which  is  not  distributed  annually  or 
regularly  under  the  provisions  of  subdivision  ( b )  of  section  two,  the 
sum  of  $3,000,  including  such  deductions  as  are  allowed  under  section 
five.” 

(2)  Subdivision  ( b )  of  section  seven  of  such  Act  of  September 
eighth,  nineteen  hundred  and  sixteen,  is  hereby  repealed. 

Sec.  1204.  (1)  That  subdivisions  (c)  and  (e)  of  section  eight  of 
such  Act  of  September  eighth,  nineteen  hundred  and  sixteen,  are 
hereby  amended  to  read  as  follows: 

“(c)  Guardians,  trustees,  executors,  administrators,  receivers, 
conservators,  and  all  persons,  corporations,  or  associations,  acting 
in  any  fiduciary  capacity,  shall  make  and  render  a  return  of  the 
income  of  the  person,  trust,  or  estate  for  whom  or  which  they  act, 
and  be  subject  to  all  the  provisions  of  this  title  which  apply  to  in¬ 
dividuals.  Such  fiduicary  shall  make  oath  that  he  has  sufficient 
knowledge  of  the  affairs  of  such  person,  trust,  or  estate  to  enable 
him  to  make  such  return  and  that  the  same  is,  to  the  best  of  his 
knowledge  and  belief,  true  and  correct,  and  be  subject  to  all  the 
provisions  of  this  title  which  apply  to  individuals:  Provided ,  That 
a  return  made  by  one  of  two  or  more  joint  fiduciaries  filed  in  the 
district  where  such  fiduciary  resides,  under  such  regulations  as  the 
Secretary  of  the  Treasury  may  prescribe,  shall  be  a  sufficient  com¬ 
pliance  with  the  requirements  of  this  paragraph:  Provided  further, 
That  no  return  of  income  not  exceeding  $3,000  shall  be  required  except 
as  in  this  title  otherwise  provided. 

49 


“(e)  Persons  carrying  on  business  in  partnership  shall  be  liable 
for  income  tax  only  in  their  individual  capacity,  and  the  share  of  the 
profits  of  the  partnership  to  which  any  taxable  partner  would  be 
entitled  if  the  same  were  divided,  whether  divided  or  otherwise, 
shall  be  returned  for  taxation  and  the  tax  paid  under  the  provisions 
of  this  title:  Provided ,  That  from  the  net  distributive  interests  on 
which  the  individual  members  shall  be  liable  for  tax,  normal  and 
additional,  there  shall  be  excluded  their  proportionate  shares  received 
from  interest  on  the  obligations  of  a  State  or  any  political  or  taxing 
subdivision  thereof,  and  upon  the  obligations  of  the  United  States 
(if  and  to  the  extent  that  it  is  provided  in  the  Act  authorizing  the 
issue  of  such  obligations  of  the  United  States  that  they  are  exempt 
from  taxation)  and  its  possessions,  and  that  for  the  purpose  of  com¬ 
puting  the  normal  tax  there  shall  be  allowed  a  credit,  as  provided  by 
section  five,  subdivision  ( b ),  for  their  proportionate  share  of  the 
profits  derived  from  dividends.  Such  partnership,  when  requested 
by  the  Commissioner  of  Internal  Revenue  or  any  district  collector, 
shall  render  a  correct  return  of  the  earnings,  profits,  and  income  of 
the  partnership,  except  income  exempt  under  section  four  of  this 
Act,  setting  forth  the  item  of  the  gross  income  and  the  deductions 
and  credits  allowed  by  this  title,  and  the  names  and  addresses  of  the 
individuals  who  would  be  entitled  to  the  net  earnings,  profits,  and 
income,  if  distributed.  A  partnership  shall  have  the  same  privilege 
of  fixing  and  making  returns  upon  the  basis  of  its  own  fiscal  year 
as  is  accorded  to  corporations  under  this  title.  If  a  fiscal  year  ends 
during  nineteen  hundred  and  sixteen  or  a  subsequent  calendar  year 
for  which  there  is  a  rate  of  tax  different  from  the  rate  for  the 
preceding  calendar  year,  then  (1)  the  rate  for  such  preceding  calen¬ 
dar  year  shall  apply  to  an  amount  of  each  partner’s  share  of  such 
partnership  profits  equal  to  the  proportion  which  the  part  of  such 
fiscal  year  falling  within  such  calendar  year  bears  to  the  full  fiscal 
year,  and  (2)  the  rate  for  the  calendar  year  during  which  such  fiscal 
year  ends  shall  apply  to  the  remainder. 

(2)  Subdivision  (d)  of  section  eight  of  such  Act  of  September 
eighth,  nineteen  hundred  and  sixteen,  is  hereby  repealed. 

Sec.  1205.  (1)  That  subdivisions  (&),  ( c ),  (/),  and  (g)  of  section 

nine  of  such  Act  of  September  eighth,  nineteen  hundred  and  sixteen, 
are  hereby  amended  to  read  as  follows: 

“(b)  All  persons,  corporations,  partnerships,  associations,  and 
insurance  companies,  in  whatever  capacity  acting,  including  lessees 
or  mortgagors  of  real  or  personal  property,  trustees  acting  in  any 
trust  capacity,  executors,  administrators,  receivers,  conservators, 
employers,  and  all  officers  and  employees  of  the  United  States,  having 
the  control,  receipt,  custody,  disposal,  or  payment  of  interest,  rent, 
salaries,  wages,  premiums,  annuities,  compensation,  remuneration, 
emoluments,  or  other  fixed  or  determinable  annual  or  periodical 
gains,  profits,  and  income  of  any  nonresident  alien  individual,  other 
than  income  derived  from  dividends  on  capital  stock,  or  from  the  net 

50 


earnings  of  a  corporation,  joint-stock  company  or  association,  or 
insurance  company,  which  is  taxable  upon  its  net  income  as  pro¬ 
vided  in  this  title,  are  hereby  authorized  and  required  to  deduct  and 
withhold  from  such  annual  or  periodical  gains,  profits,  and  income 
such  sum  as  will  be  sufficient  to  pay  the  normal  tax  imposed  thereon 
by  this  title,  and  shall  make  return  thereof  on  or  before  March  first 
of  each  year  and,  on  or  before  the  time  fixed  by  law  for  the  payment 
of  the  tax,  shall  pay  the  amount  withheld  to  the  officer  of  the 
United  States  Government  authorized  to  receive  the  same;  and 
they  are  each  hereby  made  personally  liable  for  such  tax,  and  they 
are  each  hereby  indemnified  against  every  person,  corporation, 
partnership,  association,  or  insurance  company,  or  demand  whatso¬ 
ever  for  all  payments  which  they  shall  make  in  pursuance  and  by 
virtue  of  this  title. 

(c)  The  amount  of  the  normal  tax  hereinbefore  imposed  shall  also 
be  deducted  and  withheld  from  fixed  or  determinable  annual  or 
periodical  gains,  profits,  and  income  derived  from  interest  upon 
bonds  and  mortgages,  or  deeds  of  trust  or  other  similar  obligations 
of  corporations,  joint-stock  companies,  associations,  and  insurance 
companies  (if  such  bonds,  mortgages,  or  other  obligations  contain  a 
contract  or  provision  by  which  the  obligor  agrees  to  pay  any  portion 
of  the  tax  imposed  by  this  title  upon  the  obligee  or  to  reimburse  the 
obligee  for  any  portion  of  the  tax  or  to  pay  the  interest  without 
deduction  for  any  tax  which  the  obligor  may  be  required  or  per¬ 
mitted  to  pay  thereon  or  to  retain  therefrom  under  any  law  of  the 
United  States),  whether  payable  annually  or  at  shorter  or  longer 
periods,  and  whether  such  interest  is  payable  to  a  nonresident  alien 
individual  or  to  an  individual  citizen  or  resident  of  the  United 
States,  subject  to  the  provisions  of  the  foregoing  subdivision  (b)  of 
this  section  requiring  the  tax  to  be  withheld  at  the  source  and  de¬ 
ducted  from  annual  income  and  returned  and  paid  to  the  Govern¬ 
ment,  unless  the  person  entitled  to  receive  such  interest  shall  file 
with  the  withholding  agent,  on  or  before  February  first,  a  signed 
notice  in  writing  claiming  the  benefit  of  an  exemption  under  section 
seven  of  this  title. 

“(0  All  persons,  corporations,  partnerships,  or  associations, 
undertaking  as  a  matter  of  business  or  for  profit  the  collection  of 
foreign  payments  of  interest  or  dividends  by  means  of  coupons, 
checks,  or  bills  of  exchange  shall  obtain  a  license  from  the  Commis¬ 
sioner  of  Internal  Revenue,  and  shall  be  subject  to  such  regulations 
enabling  the  Government  to  obtain  the  information  required  under 
this  title,  as  the  Commissioner  of  Internal  Revenue,  with  the  approval 
of  the  Secretary  of  the  Treasury,  shall  prescribe;  and  whoever 
knowingly  undertakes  to  collect  such  payments  as  aforesaid  without 
having  obtained  a  license  therefor,  or  without  complying  with  such 
regulations,  shall  be  deemed  guilty  of  a  misdemeanor  and  for  each 
offense  be  fined  in  a  sum  not  exceeding  $5,000,  or  imprisoned  for  a 
term  not  exceeding  one  year,  or  both,  in  the  discretion  of  the  court. 

51 


“(g)  The  tax  herein  imposed  upon  gains,  profits,  and  incomes  not 
falling  under  the  foregoing  and  not  returned  and  paid  by  virtue  of 
the  foregoing  or  as  otherwise  provided  by  law  shall  be  assessed  by 
personal  return  under  rules  and  regulations  to  be  prescribed  by  the 
Commissioner  of  Internal  Revenue  and  approved  by  the  Secretary  of 
the  Treasury.  The  intent  and  purpose  of  this  title  is  that  all  gains, 
profits,  and  income  of  a  taxable  class,  as  defined  by  this  title,  shall  be 
charged  and  assessed  with  the  corresponding  tax,  normal  and  addi¬ 
tional,  prescribed  by  this  title,  and  said  tax  shall  be  paid  by  the 
owner  of  such  income,  or  the  proper  representative  having  the 
receipt,  custody,  control,  or  disposal  of  the  same.  For  the  purpose 
of  this  title  ownership  or  liability  shall  be  determined  as  of  the 
year  for  which  a  return  is  required  to  be  rendered. 

“The  provisions  of  this  section,  except  subdivision  (c),  relating 
to  the  deduction  and  payment  of  the  tax  at  the  source  of  income 
shall  only  apply  to  the  normal  tax  hereinbefore  imposed  upon  non¬ 
resident  alien  individuals.” 

(2)  Subdivisions  (d)  and  (e)  of  section  nine  of  such  Act  of 
September  eighth,  nineteen  hundred  and  sixteen,  are  hereby  repealed. 

Sec.  1206.  (1)  That  the  first  paragraph  of  section  ten  of  such 

Act  of  September  eighth,  nineteen  hundred  and  sixteen,  is  hereby 
amended  to  read  as  follows: 

“Sec.  10.  (a)  That  there  shall  be  levied,  assessed,  collected, 

and  paid  annually  upon  the  total  net  income  received  in  the  preceding 
calendar  year  from  all  sources  by  every  corporation,  joint-stock 
company  or  association,  or  insurance  company,  organized  in  the 
United  States,  no  matter  how  created  or  organized,  but  not  including 
partnerships,  a  tax  of  two  per  centum  upon  such  income;  and  a  like 
tax  shall  be  levied,  assessed,  collected,  and  paid  annually  upon  the 
total  net  income  received  in  the  preceding  calendar  year  from  all 
sources  within  the  United  States  by  every  corporation,  joint-stock 
company  or  association,  or  insurance  company,  organized,  authorized, 
or  existing  under  the  laws  of  any  foreign  country,  including  interest  on 
bonds,  notes,  or  other  interest-bearing  obligations  of  residents, 
corporate  or  otherwise,  and  including  the  income  derived  from  divi¬ 
dends  on  capital  stock  or  from  net  earnings  of  resident  corporations, 
joint-stock  companies  or  associations,  or  insurance  companies,  whose 
net  income  is  taxable  under  this  title.” 

(2)  Section  ten  of  such  Act  of  September  eighth,  nineteen  hundred 
and  sixteen,  is  hereby  further  amended  by  adding  a  new  subdivision 
as  follows: 

“(b)  In  addition  to  the  income  tax  imposed  by  subdivision  (a) 
of  this  section  there  shall  be  levied,  assessed,  collected,  and  paid 
annually  an  additional  tax  of  ten  per  centum  upon  the  amount, 
remaining  undistributed  six  months  after  the  end  of  each  calendar 
or  fiscal  year,  of  the  total  net  income  of  every  corporation,  joint-stock 

52 


company  or  association,  or  insurance  company,  received  during  the 
year,  as  determined  for  the  purposes  of  the  tax  imposed  by  such 
subdivision  ( a ),  but  not  including  the  amount  of  any  income  taxes 
paid  by  it  within  the  year  imposed  by  the  authority  of  the  United  States. 

“The  tax  imposed  by  this  subdivision  shall  not  apply  to  that  por¬ 
tion  of  such  undistributed  net  income  which  is  actually  invested 
and  employed  in  the  business  or  is  retained  for  employment  in  the 
reasonable  requirements  of  the  business  or  is  invested  in  obligations 
of  the  United  States  issued  after  September  first,  nineteen  hundred 
and  seventeen:  Provided ,  That  if  the  Secretary  of  the  Treasury 
ascertains  and  finds  that  any  portion  of  such  amount  so  retained 
at  any  time  for  employment  in  the  business  is  not  so  employed  or 
is  not  reasonably  required  in  the  business  a  tax  of  fifteen  per  centum 
shall  be  levied,  assessed,  collected,  and  paid  thereon. 

“The  foregoing  tax  rates  shall  apply  to  the  undistributed  net 
income  received  by  every  taxable  corporation,  joint-stock  company 
or  association,  or  insurance  company  in  the  calendar  year  nineteen 
hundred  and  seventeen  and  in  each  year  thereafter,  except  that  if  it 
has  fixed  its  own  fiscal  year  under  the  provisions  of  existing  law,  the 
foregoing  rates  shall  apply  to  the  proportion  of  the  taxable  undistri¬ 
buted  net  income  returned  for  the  fiscal  year  ending  prior  to  December 
thirty-first,  nineteen  hundred  and  seventeen,  which  the  period 
between  January  first,  nineteen  hundred  and  seventeen,  and  the  end 
of  such  fiscal  year  bears  to  the  whole  of  such  fiscal  year.” 

Sec.  1207.  (1)  That  paragraphs  third  and  fourth  of  subdivision 

(a)  of  section  twelve  of  such  Act  of  September  eighth,  nineteen 
hundred  and  sixteen,  are  hereby  amended  to  read  as  follows: 

“Third.  The  amount  of  interest  paid  within  the  year  on  its 
indebtedness  (except  on  indebtedness  incurred  for  the  purchase 
of  obligations  or  securities  the  interest  upon  which  is  exempt  from 
taxation  as  income  under  this  title)  to  an  amount  of  such  indebted¬ 
ness  not  in  excess  of  the  sum  of  (a)  the  entire  amount  of  the  paid-up 
capital  stock  outstanding  at  the  close  of  the  year,  or,  if  no  capital 
stock,  the  entire  amount  of  capital  employed  in  the  business  at 
the  close  of  the  year,  and  ( b )  one-half  of  its  interest-bearing  in¬ 
debtedness  then  outstanding:  Provided ,  That  for  the  purpose 
of  this  title  preferred  capital  stock  shall  not  be  considered  interest- 
bearing  indebtedness,  and  interest  or  dividends  paid  upon  this 
stock  shall  not  be  deductible  from  gross  income:  Provided  further, 
That  in  cases  wherein  shares  of  capital  stock  are  issued  without 
par  or  nominal  value,  the  amount  of  paid-up  capital  stock,  within 
the  meaning  of  this  section,  as  represented  by  such  shares,  will  be 
the  amount  of  cash,  or  its  equivalent,  paid  or  transferred  to  the 
corporation  as  a  consideration  for  such  shares:  Provided  further , 
That  in  the  case  of  indebtedness  wholly  secured  by  property  col¬ 
lateral,  tangible  or  intangible,  the  subject  of  sale  or  hypothecation 
in  the  ordinary  business  of  such  corporation,  joint-stock  company 
or  association  as  a  dealer  only  in  the  property  constituting  such 

53 


collateral,  or  in  loaning  the  funds  thereby  procured,  the  total  interest 
paid  by  such  corporation,  company,  or  association  within  the  year 
on  any  such  indebtedness  may  be  deducted  as  a  part  of  its  expenses 
of  doing  business,  but  interest  on  such  indebtedness  shall  only 
be  deductible  on  an  amount  of  such  indebtedness  not  in  excess 
of  the  actual  value  of  such  property  collateral:  Provided  further , 
That  in  the  case  of  bonds  or  other  indebtedness,  which  have  been 
issued  with  a  guaranty  that  the  interest  payable  thereon  shall  be 
free  from  taxation,  no  deduction  for  the  payment  of  the  tax  herein 
imposed,  or  any  other  tax  paid  pursuant  to  such  guaranty,  shall 
be  allowed;  and  in  the  case  of  a  bank,  banking  association,  loan  or 
trust  company,  interest  paid  within  the  year  on  deposits  or  on  moneys 
received  for  investment  and  secured  by  interest-bearing  certificates 
of  indebtedness  issued  by  such  bank,  banking  association,  loan  or 
trust  company  shall  be  deducted; 

“Fourth.  Taxes  paid  within  the  year  imposed  by  the  authority 
of  the  United  States  (except  income  and  excess  profits  taxes),  or  of 
its  Territories,  or  possessions,  or  any  foreign  country,  or  by  the  au¬ 
thority  of  any  State,  county,  school  district,  or  municipality,  or 
other  taxing  subdivision  of  any  State,  not  including  those  assessed 
against  local  benefits.” 

(2)  Paragraphs  third  and  fourth  of  subdivision  (b)  of  section 
twelve  of  such  Act  of  September  eighth,  nineteen  hundred  and 
sixteen,  are  hereby  amended  to  read  as  follows: 

“Third.  The  amount  of  interest  paid  within  the  year  on  its 
indebtedness  (except  on  indebtedness  incurred  for  the  purchase 
of  obligations  or  securities  the  interest  upon  which  is  exempt  from 
taxation  as  income  under  this  title)  to  an  amount  of  such  indebtedness 
not  in  excess  of  the  proportion  of  the  sum  of  (a)  the  entire  amount  of 
the  paid-up  capital  stock  outstanding  at  the  close  of  the  year,  or, 
if  no  capital  stock,  the  entire  amount  of  the  capital  employed  in 
the  business  at  the  close  of  the  year,  and  ( b )  one-half  of  its  interest- 
bearing  indebtedness  then  outstanding,  which  the  gross  amount 
of  its  income  for  the  year  from  business  transacted  and  capital 
invested  within  the  United  States  bears  to  the  gross  amount  of  its 
income  derived  from  all  sources  within  and  without  the  United 
States:  Provided ,  That  in  the  case  of  bonds  or  other  indebtedness 
which  have  been  issued  with  a  guaranty  that  the  interest  payable 
thereon  shall  be  free  from  taxation,  no  deduction  for  the  payment 
of  the  tax  herein  imposed  or  any  other  tax  paid  pursuant  to  such 
guaranty  shall  be  allowed;  and  in  case  of  a  bank,  banking  association, 
loan  or  trust  company,  or  branch  thereof,  interest  paid  within  the 
year  on  deposits  by  or  on  moneys  received  for  investment  from  either 
citizens  or  residents  of  the  United  States  and  secured  by  interest- 
bearing  certificates  of  indebtedness  issued  by  such  bank,  banking 
association,  loan  or  trust  company,  or  branch  thereof; 

“Fourth.  Taxes  paid  within  the  year  imposed  by  the  authority 

54 


of  the  United  States  (except  income  and  excess  profits  taxes),  or  of 
its  Territories,  or  possessions,  or  by  the  authority  of  any  State, 
county,  school  district,  or  municipality,  or  other  taxing  subdivision 
of  any  State,  paid  within  the  United  States,  not  including  those 
assessed  against  local  benefits.” 

Sec.  1208.  That  subdivision  ( e )  of  section  thirteen  of  such 
Act  of  September  eighth,  nineteen  hundred  and  sixteen,  is  hereby 
amended  to  read  as  follows: 

“(*)  All  the  provisions  of  this  title  relating  to  the  tax  authorized 
and  required  to  be  deducted  and  withheld  and  paid  to  the  officer 
of  the  United  States  Government  authorized  to  receive  the  same 
from  the  income  of  nonresident  alien  individuals  from  sources 
within  the  United  States  shall  be  made  applicable  to  the  tax  imposed 
by  subdivision  (a)  of  section  ten  upon  incomes  derived  from  interest 
upon  bonds  and  mortgages  or  deeds  of  trust  or  similar  obligations 
of  domestic  or  other  resident  corporations,  joint-stock  companies 
or  associations,  and  insurance  companies  by  nonresident  alien 
firms,  copartnerships,  companies,  corporations,  joint-stock  com¬ 
panies  or  associations,  and  insurance  companies,  not  engaged  in 
business  or  trade  within  the  United  States  and  not  having  any 
office  or  place  of  business  therein.” 

Sec.  1209.  That  section  eighteen  of  such  Act  of  September  eighth, 
nineteen  hundred  and  sixteen,  is  hereby  amended  to  read  as  follows: 

“Sec.  18.  That  any  person,  corporation,  partnership,  association, 
or  insurance  company,  liable  to  pay  the  tax,  to  make  a  return  or  to 
supply  information  required  under  this  title,  who  refuses  or  neglects 
to  pay  such  tax,  to  make  such  return  or  to  supply  such  information 
at  the  time  or  times  herein  specified  in  each  year,  shall  be  liable, 
except  as  otherwise  specially  provided  in  this  title,  to  a  penalty  of  not 
less  than  $20  nor  more  than  $1,000.  Any  individual  or  any  officer  of 
any  corporation,  partnership,  association,  or  insurance  company,  re¬ 
quired  by  law  to  make,  render,  sign,  or  verify  any  return  or  to  supply 
any  information,  who  makes  any  false  or  fraudulent  return  or  state¬ 
ment  with  intent  to  defeat  or  evade  the  assessment  required  by  this 
title  to  be  made,  shall  be  guilty  of  a  misdemeanor,  and  shall  be 
fined  not  exceeding  $2,000  or  be  imprisoned  not  exceeding  one  year, 
or  both,  in  the  discretion  of  the  court,  with  the  costs  of  prosecution: 
Provided ,  That  where  any  tax  heretofore  due  and  payable  has  been 
duly  paid  by  the  taxpayer,  it  shall  not  be  re-collected  from  any 
withholding  agent  required  to  retain  it  at  its  source,  not  shall  any 
penalty  be  imposed  or  collected  in  such  cases  from  the  taxpayer, 
or  such  withholding  agent  whose  duty  it  was  to  retain  it,  for  failure 
to  return  or  pay  the  same,  unless  such  failure  was  fraudulent  and  for 
the  purpose  of  evading  payment.” 

Sec.  1210.  That  section  twenty-six  of  such  Act  of  September 
eighth,  nineteen  hundred  and  sixteen,  as  amended  by  the  Act  entitled 
“An  Act  to  provide  increased  revenue  to  defray  the  expenses  of  the 

55 


increased  appropriations  for  the  Army  and  Navy  and  the  extensions 
of  fortifications,  and  for  other  purposes,”  approved  March  third, 
nineteen  hundred  and  seventeen,  is  hereby  amended  to  read  as  follows: 

“Sec.  26.  Every  corporation,  joint-stock  company  or  association, 
or  insurance  company  subject  to  the  tax  herein  imposed,  when 
required  by  the  Commissioner  of  Internal  Revenue,  shall  render  a 
correct  return,  duly  verified  under  oath,  of  its  payments  of  dividends, 
whether  made  in  cash  or  its  equivalent  or  in  stock,  including  the 
names  and  addresses  of  stockholders  and  the  number  of  shares  owned 
by  each,  and  the  tax  years  and  the  applicable  amounts  in  which  such 
dividends  were  earned,  in  such  form  and  manner  as  may  be  prescribed 
by  the  Commissioner  of  Internal  Revenue,  with  the  approval  of  the 
Secretary  of  the  Treasury.” 

Sec.  1211.  That  Title  I  of  such  Act  of  September  eighth,  nine¬ 
teen  hundred  and  sixteen,  is  hereby  amended  by  adding  to  Part 
III  six  new  sections,  as  follows: 

“Sec.  27.  That  every  person,  corporation,  partnership,  or 
association,  doing  business  as  a  broker  on  any  exchange  or  board 
of  trade  or  other  similar  place  of  business  shall,  when  required  by 
the  Commissioner  of  Internal  Revenue,  render  a  correct  return  duly 
verified  under  oath,  under  such  rules  and  regulations  as  the  Com¬ 
missioner  of  Internal  Revenue,  with  the  approval  of  the  Secretary 
of  the  Treasury,  may  prescribe,  showing  the  names  of  customers 
for  whom  such  person,  corporation,  partnership,  or  association  has 
transacted  any  business,  with  such  details  as  to  the  profits,  losses,  or 
other  information  which  the  commissioner  may  require,  as  to  each 
of  such  customers,  as  will  enable  the  Commissioner  of  Internal 
Revenue  to  determine  whether  all  income  tax  due  on  profits  or  gains 
of  such  customers  has  been  paid. 

“Sec.  28.  That  all  persons,  corporations,  partnerships,  associa¬ 
tions,  and  insurance  companies,  in  whatever  capacity  acting,  including 
lessees  or  mortgagors  of  real  or  personal  property,  trustees  acting 
in  any  trust  capacity,  executors,  administrators,  receivers,  con¬ 
servators,  and  employers,  making  payment  to  another  person, 
corporation,  partnership,  association,  or  insurance  company,  of 
interest,  rent,  salaries,  wages,  premiums,  annuities,  compensation, 
remuneration,  emoluments,  or  other  fixed  or  determinable  gains, 
profits,  and  income  (other  than  payments  described  in  sections 
twenty-six  and  twenty-seven),  of  $800  or  more  in  any  taxable  year, 
or,  in  the  case  of  such  payments  made  by  the  United  States,  the 
officers  or  employees  of  the  United  States  having  information  as  to 
such  payments  and  required  to  make  returns  in  regard  thereto 
by  the  regulations  hereinafter  provided  for,  are  hereby  authorized 
and  required  to  render  a  true  and  accurate  return  to  the  Commis¬ 
sioner  of  Internal  Revenue,  under  such  rules  and  regulations  and  in 
such  form  and  manner  as  may  be  prescribed  b}^  him,  with  the  approval 
of  the  Secretary  of  the  Treasury,  setting  forth  the  amount  of  such 
gains,  profits,  and  income,  and  the  name  and  address  of  the  recipient 

56 


of  such  payment:  Provided ,  That  such  returns  shall  be  required, 
regardless  of  amounts,  in  the  case  of  payments  of  interest  upon 
bonds  and  mortgages  or  deeds  of  trust  or  other  similar  obligations  of 
corporations,  joint-stock  companies,  associations,  and  insurance 
companies,  and  in  the  case  of  collections  of  items  (not  payable  in  the 
United  States)  of  interest  upon  the  bonds  of  foreign  countries  and 
interest  from  the  bonds  and  dividends  from  the  stock  of  foreign 
corporations  by  persons,  corporations,  partnerships,  or  associations, 
undertaking  as  a  matter  of  business  or  for  profit  the  collection  of 
foreign  payments  of  such  interest  or  dividends  by  means  of  coupons, 
checks,  or  bills  of  exchange. 

“When  necessary  to  make  effective  the  provisions  of  this  section 
the  name  and  address  of  the  recipient  of  income  shall  be  furnished 
upon  demand  of  the  person,  corporation,  partnership,  association,  or 
insurance  company  paying  the  income. 

“The  provisions  of  this  section  shall  apply  to  the  calendar  year 
nineteen  hundred  and  seventeen  and  each  calendar  year  thereafter, 
but  shall  not  apply  to  the  payment  of  interest  on  obligations  of  the 
United  States. 

“Sec.  29.  That  in  assessing  income  tax  the  net  income  embraced 
in  the  return  shall  also  be  credited  with  the  amount  of  any  excess 
profits  tax  imposed  by  Act  of  Congress  and  assessed  for  the  same 
calendar  or  fiscal  year  upon  the  taxpayer,  and,  in  the  case  of  a  member 
of  a  partnership,  with  his  proportionate  share  of  such  excess  profits 
tax  imposed  upon  the  partnership. 

“Sec.  30.  That  nothing  in  section  II  of  the  Act  approved  October 
third,  nineteen  hundred  and  thirteen,  entitled  ‘An  Act  to  reduce  tariff 
duties  and  to  provide  revenue  for  the  Government,  and  for  other 
purposes/  or  in  this  title,  shall  be  construed  as  taxing  the  income  of 
foreign  governments  received  from  investments  in  the  United  States 
in  stocks,  bonds,  or  other  domestic  securities,  owned  by  such  foreign 
governments,  or  from  interest  on  deposits  in  banks  in  the  United 
States  of  moneys  belonging  to  foreign  governments. 

“Sec.  31.  ( a )  That  the  term  ‘dividends’  as  used  in  this  title 

shall  be  held  to  mean  any  distribution  made  or  ordered  to  be  made 
by  a  corporation,  joint-stock  company,  association,  or  insurance  com¬ 
pany,  out  of  its  earnings  or  profits  accrued  since  March  first,  nineteen 
hundred  and  thirteen,  and  payable  to  its  shareholders,  whether  in  cash 
or  in  stock  of  the  corporation,  joint-stock  company,  association,  or 
insurance  company,  which  stock  dividend  shall  be  considered  in¬ 
come,  to  the  amount  of  the  earnings  or  profits  so  distributed. 

(b)  Any  distribution  made  to  the  shareholders  or  members  of 
a  corporation,  joint-stock  company,  or  association,  or  insurance 
company,  in  the  year  nineteen  hundred  and  seventeen,  or  sub¬ 
sequent  tax  years,  shall  be  deemed  to  have  been  made  from  the  most 
recently  accumulated  undivided  profits  or  surplus,  and  shall  consti¬ 
tute  a  part  of  the  annual  income  of  the  distributee  for  the  year  in 

57 


which  received,  and  shall  be  taxed  to  the  distributee  at  the  rates 
prescribed  by  law  for  the  years  in  which  such  profits  or  surplus 
were  accumulated  by  the  corporation,  joint-stock  company,  asso¬ 
ciation,  or  insurance  company,  but  nothing  herein  shall  be  construed 
as  taxing  any  earnings  or  profits  accrued  prior  to  March  first, 
nineteen  hundred  and  thirteen,  but  such  earnings  or  profits  may 
be  distributed  in  stock  dividends  or  otherwise,  exempt  from  the  tax, 
after  the  distribution  of  earnings  and  profits  accrued  since  March 
first,  nineteen  hundred  and  thirteen,  has  been  made.  This  sub¬ 
division  shall  not  apply  to  any  distribution  made  prior  to  August 
sixth,  nineteen  hundred  and  seventeen,  out  of  earnings  or  profits 
accrued  prior  to  March  first,  nineteen  hundred  and  thirteen. 

Sec.  32.  That  premiums  paid  on  life  insurance  policies  covering 
the  lives  of  officers,  employees,  or  those  financially  interested  in 
any  trade  or  business  conducted  by  an  individual,  partnership, 
corporation,  joint-stock  company  or  association,  or  insurance 
company,  shall  not  be  deducted  in  computing  the  net  income  of 
such  individual,  corporation,  joint-stock  company  or  association, 
or  insurance  company,  or  in  computing  the  profits  of  such  partner¬ 
ship  for  the  purposes  of  subdivision  (e)  of  section  nine. 

Sec.  1212.  That  any  amount  heretofore  withheld  by  any  with¬ 
holding  agent  as  required  by  Title  I  of  such  Act  of  September  eighth, 
nineteen  hundred  and  sixteen,  on  account  of  the  tax  imposed  upon 
the  income  of  any  individual,  a  citizen  or  resident  of  the  United 
States,  for  the  calendar  year  nineteen  hundred  and  seventeen, 
except  in  the  cases  covered  by  subdivision  (c)  of  section  nine  of  such 
Act,  as  amended  by  this  Act,  shall  be  released  and  paid  over  to  such 
individual,  and  the  entire  tax  upon  the  income  of  such  individual 
for  such  year  shall  be  assessed  and  collected  in  the  manner  prescribed 
by  such  Act  as  amended  by  this  Act. 

TITLE  XIXI. — General  Provisions. 

Sec.  1300.  That  if  any  clause,  sentence,  paragraph,  or  part  of 
this  Act  shall  for  any  reason  be  adjudged  by  any  court  of  competent 
jurisdiction  to  be  invalid,  such  judgment  shall  not  affect,  impair,  or 
invalidate  the  remainder  of  said  Act,  but  shall  be  confined  in  its 
operation  to  the  clause,  sentence,  paragraph,  or  part  thereof  directly 
involved  in  the  controversy  in  which  such  judgment  shall  have  been 
rendered. 

Sec.  1301.  That  Title  I  of  the  Act  entitled  “An  Act  to  provide 
increased  revenue  to  defray  the  expenses  of  the  increased  appro¬ 
priations  for  the  Army  and  Navy  and  the  extension  of  fortifications, 
and  for  other  purposes,”  approved  March  third,  nineteen  hundred  and 
seventeen,  be,  and  the  same  is  hereby  repealed. 

Sec.  1302.  That  unless  otherwise  herein  specially  provided,  this 
Act  shall  take  effect  on  the  day  following  its  passage. 

58 


(Hljp  (Enrpnratum  ®ruat  (Eompatty 

FEDERAL  TAX  SERVICES. 

INCOME  TAX  SERVICE. 

The  Income  Tax  Service  collects  rulings,  regulations,  opinions  and 
decisions  from  all  Federal  official  sources,  bearing  on  the  administra¬ 
tion  and  interpretation  of  the  provisions  of  the  income  tax  law  of 
September  8,  1916,  as  amended,  including  the  tax  on  undistributed 
profits  of  corporations,  and  the  war  income  tax  law  of  1917. 

WAR  TAX  SERVICE. 

The  War  Tax  Service  similarly  collects  and  reports  the  rulings, 
regulations,  opinions  and  decisions  on  the  war  profits  tax,  the  war 
stamp  taxes,  the  capital  stock  tax,  the  estate  tax,  the  war  tax  on 
facilities  furnished  by  public  utilities,  the  war  excise  taxes,  the  war 
tax  on  admissions,  and  the  special  taxes  on  occupations. 

SERVICE  REPORTS. 

Reports  are  sent  out  in  each  Service  containing  the  exact  text 
of  each  official  formal  regulation,  ruling,  opinion  or  decision  as  soon 
as  it  is  available  from  official  sources,  during  the  year.  Reports 
for  each  Service  are  printed  on  sheets  of  uniform  size,  consecutively 
numbered  so  that  the  subscriber  knows  at  a  glance  if  any  matter  is 
missing,  and  punched  for  insertion  in  a  binder  which  is  furnished 
with  the  Service.  Promptness  is  the  keynote  of  the  Services.  Special 
arrangements  are  in  operation  to  print  and  mail  (under  first  class 
postage)  with  the  greatest  possible  speed.  The  Services  compete 
with  the  newspapers  in  speed,  but  no  newspaper  competes  with  the 
Services  in  accuracy  and  completeness. 

THE  ANNUAL  COMPILATION. 

For  the  Income  Tax  Service,  at  the  beginning  of  each  year,  a 
compilation  is  made  of  all  matters  previously  issued  then  in  force, 
so  arranged  that  the  rulings,  regulations,  etc.,  bearing  on  any  given 
point  may  be  found  in  one  place.  This  compilation  enables  the 
reader  to  examine  at  a  glance  that  for  which  he  would  otherwise 
search  through  many  pages.  The  compilation  contains  no  repealed 
or  superseded  matter.  The  language  of  the  official  documents, 
without  comment  or  conclusions  of  others,  is  used.  The  matter  is 
arranged  under  headings  and  subheadings  that  follow  naturally  the 
arrangement  of  the  law.  The  compilation,  supplemented  by  the 
new  matter  sent  out  during  the  year,  forms  an  independent  complete 
annual  book  of  reference. 


59 


So  far  as  practical  and  necessary  for  convenient  use,  the  War 
Tax  Service  will  be  compiled  annually  in  like  manner. 

THE  SERVICE  BOOKS. 

Each  Service  is  contained  in  a  substantial  loose  leaf  ring  binder. 
The  insertion  or  removal  of  sheets  takes  but  a  minute.  All  reports 
are  plainly  designated  so  that  new  matter  easily  finds  its  place  in 
the  book.  An  office  boy  or  clerk  can  attend  to  the  proper  insertion 
of  new  matter. 


CONTENTS. 

The  Income  Tax  Service  is  devoted  exclusively  to  the  income 
tax  law,  amendments  thereto  and  the  regulations  bearing  thereon. 

In  the  War  Tax  Service  each  tax  is  given  a  separate  section  in 
the  book.  Within  that  section  appears  a  copy  of  the  law,  followed, 
in  chronological  order,  by  the  regulations,  rulings,  etc.,  issued  since 
the  passage  of  the  respective  Acts.  Thus  the  War  Tax  Service  is 
a  combination  of  several  units  in  one  binder,  each  unit  being  in  effect 
a  complete  Service. 


FORMS. 

Each  book  contains  a  complete  collection  of  all  forms  used  in  the 
making  of  returns,  and  in  the  assessment,  collection,  refund  and  abate¬ 
ment  of  the  several  taxes. 

LIST  OF  COLLECTION  DISTRICTS. 

Each  Service  contains  a  complete  list  of  collection  districts  show¬ 
ing  in  detail  the  territory  covered  by  each  district  and  the  name  and 
address  of  the  collector.  Another  list  gives  the  names,  addresses  and 
respective  territories  of  the  internal  revenue  agents.  Like  all  other 
matter  in  the  Service  this  is  subject  to  constant  revision,  new  pages 
being  sent  out  for  substitution  whenever  there  is  a  change  of  any 
kind  in  the  information  reported. 

RUNNING  TABLES  OF  CONTENTS. 

The  Income  Tax  Service  and  each  unit  of  the  War  Tax  Service 
contains  a  running  table  of  contents  of  current  matter,  the  last  page 
of  which  is  revised,  reprinted,  and  sent  for  substitution  whenever  an 
additional  report  is  mailed.  Thus,  by  means  of  this  table,  the 
subscriber  has  before  him,  at  all  times,  a  complete  list  of  all  rulings, 
etc. 


60 


INDEXES. 


The  Services  are  fully  indexed.  The  indexes  are  revised  com¬ 
pletely  as  occasion  requires  during  the  year.  The  number  of  un¬ 
indexed  pages  in  the  books  is  never  allowed  to  grow  unduly  large; 
furthermore  the  contents  of  such  pages  may  be  ascertained  quickly 
by  reference  to  the  running  tables  of  contents  which,  as  stated 
before,  are  kept  constantly  revised. 

CROSS  REFERENCE. 

Each  paragraph  printed  for  either  Service  has  its  distinctive 
number  in  bold-face  type,  the  numbers  being  consecutive,  in  series. 
Under  the  bold-face  figures  on  each  new  sheet  sent  out  appear 
figures  in  smaller  type  which  refer  to  preceding  paragraphs  treating 
of  the  same  subject.  Thus  every  paragraph  of  new  matter  is  at 
once  linked  to  all  paragraphs  on  the  same  subject  which  have  pre¬ 
ceded  it.  Corresponding  forward  references  to  the  new  paragraphs 
may  be  made  quickly,  thus  providing  for  a  complete  cross  reference 
to  every  paragraph  in  the  book  at  all  times.  This  ingenious  device, 
supplementing  the  tables  of  contents  and  the  indexes,  makes  the 
information  in  each  book  readily  accessable.  By  its  use  the  sub¬ 
scriber  may  assure  himself  in  a  minimum  of  time  that  he  has  read 
every  ruling,  regulation  or  opinion  on  a  given  point. 


AN  EXCLUSIVE  FEATURE. 

In  addition  to  the  formal  regulations,  informal  rulings  are  repro¬ 
duced  in  the  Services  in  the  form  of  correspondence  between  the 
Government  officials  and  taxpayers  regarding  specific  questions. 
Such  correspondence  is  sent  us  by  subscribers  from  all  over  the 
country  and  in  printed  exclusively  in  the  Services.  Special  rulings 
of  this  kind  are  extremely  helpful  in  understanding  fully  and  applying 
the  formal  Treasury  Decisions.  The  Services,  in  this  respect,  are 
unique.  Such  matter  is  not  collected  and  published  in  any  other 
medium. 


TERMS  OF  SUBSCRIPTION. 

All  subscriptions  are  for  the  calendar  year  and  include  the  Service 
binders  containing  all  formal  rulings  and  regulations  in  force  up 
to  the  time  of  subscription. 

The  subscription  fee  to  new  subscribers  is  $20  for  the  year,  for 
each  Service;  on  renewal  $15  per  annum. 


61 


UNIVERSITY  OF  ILLINOIS-URBANA 


3  0112  061585128 
SPECIAL  PRICES  IN  EFFECT  SEPTEMBER  25,  1917. 


A  special  subscription  price  is  made  for  the  remainder  of  1917, 
including  all  matter  issued  to  date,  of  $15  for  each  Service  or  $30 
for  the  two. 


The  subscription  price  from  the  present  time  to  the  end  of  1918 
for  each  Service  is  $30.  Where  both  Services  are  taken  the  com¬ 
bination  price  is  $55,  for  1917  and  1918. 


THE  SERVICES  ON  APPROVAL. 


It  is  to  be  understood  that  all  subscriptions  to  the  Services  are 
placed  on  condition  that,  if  after  examination  of  the  Service  books 
sent,  the  subscriber  is  not  fully  satisfied  with  the  value  of  the  Services 
to  him,  the  books  may  be  returned,  and  payments  will  be  refunded. 

THE  CORPORATION  TRUST  COMPANY. 


1917. 


The  Corporation  Trust  Company, 

37  Wall  St.,  New  York  City. 

Gentlemen: 

payment  of  the 

1917  1917 

only  and 
1918 
$15  $30 

$15  $30 

$30  $55 


Write  name 
and  address 
plainly 


Name. . 
Address 


Enclosed  find  check  for  $. 
following : 


in 


Strike  out 
subscriptions 
not  ordered 


Income  Tax  Service. 
War  Tax  Service. . . . 
Both  Services . 


62 


